You don't need much money to get started investing. And stocks with relatively low share prices have tremendous growth prospects.
Three Fool.com contributors identified no-brainer healthcare stocks to buy for under $100. Here's why they chose CRISPR Therapeutics (CRSP -1.35%), Novocure (NVCR 2.36%), and Pfizer (PFE -0.19%).
CRISPR Therapeutics could soon soar past $100
David Jagielski (CRISPR Therapeutics): Shares of CRISPR Therapeutics are trading below $70, but it may not be long before they take off. The company has a promising gene-editing therapy in exa-cel for rare blood disorders beta-thalassemia and sickle cell disease that it has been working on with Vertex Pharmaceuticals. Even at $1.9 million per dose, it could be a cost-effective therapy, given that it can be a functional cure for diseases that up until now have required continuous, ongoing treatment.
At its peak, exa-cel could generate more than $1 billion in revenue. Vertex and CRISPR Therapeutics have recently submitted their Biologics License Applications for exa-cel, and if it obtains approval (potentially within the next year), that may put CRISPR Therapeutics on the map in the healthcare industry.
And it wouldn't surprise me if the company became an acquisition target for a larger healthcare company. At a market cap of around $5.2 billion, it's not a big price tag for a business that could be at the forefront of multiple gene-editing therapies.
In addition to exa-cel, CRISPR Therapeutics is also working on CTX110 for the treatment of certain blood cancers, plus CTX130 is in early-stage trials as a potential treatment for renal cell carcinoma (kidney cancer).
CRISPR Therapeutics doesn't have an approved product right now, so there is some risk. But given the progress it has been making, it's a calculated risk worth taking. And with close to $1.9 billion in cash and marketable securities, the company is in a strong financial position.
Novocure: Poised to take off
Keith Speights (Novocure): You might not think that Novocure looks like a potentially huge winner based on its year-to-date performance. Its share price is hovering under $80 after rising by a single-digit percentage. However, the stock is poised to take off -- and potentially soon.
Novocure plans to present data from its late-stage clinical study evaluating its tumor treating fields (TTFields) therapy in non-small cell lung cancer on June 6. This data could very well provide a major catalyst for the stock.
There's reason for optimism. Novocure has already announced that the study showed "statistically significant and clinically meaningful improvement in overall survival" for patients. The company plans to seek U.S. clearance for its TTFields device in non-small cell lung cancer in the second half of 2023.
But that's not all. Novocure is conducting late-stage studies targeting three other indications: brain metastases, ovarian cancer, and pancreatic cancer. Results from the ovarian cancer study are on the way later this year. Data from the other two studies should be announced in 2024.
All the new late-stage indications represent a market opportunity that's 14 times bigger than the current TTFields market in treating glioblastoma. Positive clinical results should give Novocure a much bigger market cap over the next few years.
A deeply undervalued pharma stock
Prosper Junior Bakiny (Pfizer): The market hasn't been kind to Pfizer this year. The company's shares are down by 25% since January.
On the one hand, the drugmaker is going through a transition period, during which its revenue will decline. But on the other hand, Pfizer should be more than fine on the other side of this transition, making its current predicament an excellent opportunity for investors.
Over the past two years, Pfizer has replenished its pipeline thanks to a string of acquisitions. Of course, it had programs of its own, too. The result: Pfizer is well on its way to earning important approvals that will add billions in revenue through the end of the decade. The buyout of cancer specialist Seagen alone should have a meaningful impact on the company's business.
That's just one of the many pieces Pfizer recently added to its arsenal. And there is more to like about the company's business. Consider Pfizer's dividend profile. The company currently offers a dividend yield of 4.23%, more than twice that of the S&P 500 average at 1.66%. Pfizer's cash payout ratio stands at a reasonable 44.7%; the company has increased its payouts by 20.6% in the last five years.
With Pfizer, investors get a steady, blue chip pharmaceutical company that will offer growing revenue and profits once its business picks back up and it lands new approvals and increases dividends. And investors get all this for just about $38 per share and a forward price-to-earnings of 11.3 -- the average for the pharmaceutical industry is 15.1.
Pfizer looks like a steal at these levels.
