Many stocks that have delivered big gains eventually succumb to the investing equivalent of gravity. However, not all of them do. Some keep the momentum going and going.
Three Motley Fool contributors think that they've found high-flying stocks that can go much higher in 2024. Here's why they picked CRISPR Therapeutics (CRSP 0.34%), Eli Lilly (LLY 1.19%), and Novo Nordisk (NVO 0.84%).
This biotech still has room to run higher
David Jagielski (CRISPR Therapeutics): One stock that I don't expect to slow down this year is CRISPR Therapeutics. Last year, shares of CRISPR surged 54%. Fresh off the approval of its first gene-editing therapy, Casgevy, there could be more reasons to remain bullish on the biotech stock in 2024.
Earlier this month, CRISPR and its development partner Vertex Pharmaceuticals obtained approval for Casgevy to treat transfusion-dependent beta-thalassemia. In December, the therapy was approved for sickle cell disease.
Analysts at Goldman Sachs project that revenue from Casgevy could top $3.9 billion at its peak. Even though CRISPR will share in the profits on Casgevy, with CRISPR collecting 40% of the earnings (Vertex will take 60%), the commercialization and rollout for Casgevy could drastically improve CRISPR's financial outlook. Over the trailing 12 months, the company has incurred net losses totaling $354 million.
There could be more catalysts beyond that for CRISPR. Later this year, the company also plans to provide updates for a couple of next-generation CAR-T product candidates in its portfolio. Positive updates from those products could help lift shares of CRISPR even higher.
The stock has fallen since it obtained regulatory approval for Casgevy as a treatment for sickle cell disease. This could be a sign that investors are cashing out. However, I suspect that it won't be too long before the stock begins to rally again.
The biggest drugmaker in the world
Keith Speights (Eli Lilly): Eli Lilly's shares have skyrocketed close to 75% over the last 12 months. In the process, the company dethroned Johnson & Johnson as the biggest drugmaker in the world based on market cap. I don't think Lilly's stellar run is anywhere close to being over.
For one thing, the company's weight-loss drug Zepbound is just getting started. Lilly won U.S. regulatory approval for the drug in November 2023.
Based on early prescription trends, it's already gaining significant market share. Some analysts predict that Zepbound and Mounjaro, Lilly's type 2 diabetes drug based on the same active ingredient, will combine to generate peak annual sales of more than $50 billion.
Mounjaro has already proved to be a spectacular success in treating type 2 diabetes. Lilly reported the drug had nearly $3 billion in sales during the first nine months of 2023.
The big pharma also has other major growth drivers in its current lineup. Sales for breast cancer drug Verzenio soared 68% year over year in the third quarter of 2023. Jardiance, which is approved for treating type 2 diabetes, heart failure, and chronic kidney disease, kept up its momentum with sales jumping 22%. Sales for autoimmune-disease drug Olumiant vaulted 27% higher.
Two of Lilly's newer cancer drugs, Retevmo and Tyvyt, are also gaining traction with sales rising by 56% and 50%, respectively, in the third quarter.
Lilly could soon have yet another big winner on the market. The Food and Drug Administration (FDA) expects to make an approval decision on donanemab in treating early symptomatic Alzheimer's disease later in the first quarter of 2024. If approved, analysts think the drug could achieve annual sales of $6 billion by 2026.
A biotech giant with ample upside potential
Prosper Junior Bakiny (Novo Nordisk): Denmark-based Novo Nordisk was unstoppable in 2023. The drugmaker's financial results were excellent, the company reported meaningful clinical progress, and it even helped its home country's economy soar.
There's no secret behind Novo Nordisk's recent success. The company is a leader in the market for weight loss drugs, an area that has risen in popularity in recent years. Ozempic has become known as an off-label drug for weight loss, so much so that Novo Nordisk has had trouble meeting demand.
And last year was just the beginning. The anti-obesity market is projected to skyrocket through the end of the decade. That will provide a significant tailwind to Novo Nordisk.
The biotech should also benefit from more clinical and regulatory progress. Last year, semaglutide (the active ingredient in Ozempic and its siblings, Rybelsus and Wegovy) aced a clinical trial targeting kidney disease in diabetes patients.
The medicine could earn major label expansions. Meanwhile, Novo Nordisk could win approval for icodec, a once-weekly insulin product, this year. Beyond its core therapeutic areas of diabetes and obesity care, the company has made a conscientious effort to develop medicines in other fields, including Alzheimer's, sickle cell disease, and more.
What does all this mean for investors? Though the company's performance last year was great, it should keep its momentum going through 2024 and perhaps even outdo its showing from 2023.
More importantly, Novo Nordisk's long-term prospects look great, so whether or not it crushes the market again this year, investors can safely hold on to the stock for the long haul.
