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Globe and Mail
29-05-2025
- Business
- Globe and Mail
Is Amgen Stock a Buy?
Amgen (NASDAQ: AMGN) is doing something unusual in 2025. The biotech giant's shares are up 7.2% for the year as I write this while most large-cap healthcare stocks struggle; yet it trades at just 13 times forward earnings estimates compared to 21 for the S&P 500. That disconnect between performance and valuation creates an opportunity. With 14 drugs posting double-digit sales growth in the most recent quarter, a promising obesity drug in late-stage trials, and a 3.5% dividend yield, Amgen offers investors a rare combination of growth, income, and value. Here's why this $150 billion pharmaceutical powerhouse deserves a closer look by investors of all stripes. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Broad-based growth defies biotech blues Amgen delivered stellar first-quarter 2025 results in early May that demonstrated the power of its diversified portfolio, with total revenue climbing 9% year-over-year to $8.1 billion and non-GAAP earnings per share surging 24% to $4.90. The company's performance was driven by remarkable strength across multiple therapeutic areas, with 14 products achieving double-digit sales growth during the three months, relative to the same period a year ago. Leading the charge was asthma blockbuster Tezspire at 65%, followed by cancer drug Blincyto with explosive 52% growth, the osteoporosis treatment Evenity at 29%, and cholesterol-lowering Repatha at 27%. What makes Amgen's growth particularly noteworthy is its ability to maintain robust profitability while investing heavily in future innovation. The company's non-GAAP operating margin expanded 2.5 percentage points to 45.7% in the first quarter of 2025, demonstrating exceptional operating leverage even as research and development expenses climbed 12% to support late-stage clinical programs. This includes pivotal investments in MariTide, Amgen's highly anticipated obesity drug that could transform the company's growth trajectory. Pipeline promises next wave of blockbusters While Amgen's current portfolio delivers steady growth, the company's late-stage pipeline could unleash a new era of expansion. The crown jewel is MariTide (maridebart cafraglutide), a differentiated obesity treatment that activates the GLP-1 receptor while antagonizing GIPR. With Phase 3 trials now enrolling patients and additional studies launching throughout 2025, MariTide represents a multibillion-dollar opportunity in the white-hot obesity market. Beyond MariTide, Amgen's pipeline depth is impressive. Rocatinlimab for atopic dermatitis has delivered stellar Phase 3 results across multiple studies, with the Ignite trial showing 42.3% of patients achieving significant skin clearance versus just 12.5% for placebo. In oncology, tarlatamab (Imdelltra) just demonstrated improved overall survival in small cell lung cancer, potentially establishing a new standard of care in second-line small cell lung cancer. The company's biosimilar strategy also provides a competitive edge. With successful launches of Pavblu (Eylea biosimilar) and Wezlana (Stelara biosimilar), plus upcoming biosimilars for blockbusters Opdivo and Keytruda, Amgen is well positioned to capture market share as several high-earning biologics lose patent protection in the coming years. Financial fortress with shareholder rewards Amgen's financial profile stands out in the biotech space. The company generated $1 billion in free cash flow during Q1 2025, up from $0.5 billion a year earlier, providing ample resources for both business development and shareholder rewards. Management raised the quarterly dividend 6% to $2.38 per share, resulting in an attractive 3.5% yield at the current stock price. The balance sheet remains rock-solid even after the $27.8 billion Horizon Therapeutics acquisition. Amgen reduced debt by $2.8 billion in Q1 and maintains the flexibility to pursue strategic opportunities while returning cash to shareholders. Full-year 2025 guidance calls for revenue of $34.3 billion to $35.7 billion and non-GAAP earnings per share of $20.00 to $21.20, representing mid-single-digit growth at the midpoint. Is Amgen stock a buy? With shares trading at a significant discount to the broader market, Amgen stock presents a compelling opportunity for value-conscious investors. The combination of 14 products delivering double-digit growth, a potentially transformative obesity drug in late-stage development, and a generous 3.5% dividend yield makes this biotech giant a buy for investors seeking both growth and income at a reasonable price. Should you invest $1,000 in Amgen right now? Before you buy stock in Amgen, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Amgen wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,389!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $830,492!* Now, it's worth noting Stock Advisor 's total average return is982% — a market-crushing outperformance compared to171%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of May 19, 2025
Yahoo
08-05-2025
- Business
- Yahoo
2 Unstoppable Dividend Stocks to Buy and Hold Forever
Amgen is an innovative leader in an industry where its products will always be in high demand. Microsoft is navigating the current situation well and boasts lucrative growth opportunities. Both companies have increased their payouts at a good clip over the past decade. 10 stocks we like better than Amgen › Some research has shown that dividend-paying stocks significantly outperformed their non-dividend-paying peers over the past few decades, and that the lion's share of market returns can be attributed to reinvested dividends and compounding. Those are excellent arguments for investing in dividend stocks and holding on to them for a long time. However, not all dividend-paying companies are equally attractive. Which ones should you consider? Two excellent options right now are Amgen (NASDAQ: AMGN) and Microsoft (NASDAQ: MSFT). Here's why these two income stocks are worth sticking with for good. It's never a bad idea to turn to leading drugmakers like Amgen when looking for forever stocks. The business of developing and marketing innovative therapies for serious, sometimes life-threatening diseases will never go out of style until we find all-purpose cures for all conditions. While individual drugmakers could fail, Amgen's business looks strong enough to avoid that fate for a long time. It boasts an extensive lineup of medicines, with over 10 that each generated upwards of $1 billion in sales in 2024. In the first quarter, revenue increased by a strong 9% year over year to $8.1 billion. Amgen's lineup is diversified across several therapeutic areas, including oncology, immunology, rare diseases, and respiratory diseases. Key growth drivers (not an exhaustive list) include Tezspire, an asthma medication; Repatha, which treats high cholesterol; and blood-cancer medicine Blincyto. Like every drugmaker, Amgen will, at some point, face patent cliffs that will erode sales of important products. The way to get around this issue is to develop newer medicines. Looking at the company's pipeline, it seems more than capable of doing so. It boasts a few dozen programs that should lead to label expansions and brand-new approvals. The company has been working on a promising weight management candidate, MariTide. Though this product somewhat disappointed in phase 2 studies, it's still in the running to reach the market and generate decent sales, considering how rapidly the anti-obesity space is growing. Besides, Amgen is developing another weight loss candidate that's still in phase 1 studies. Weight loss isn't the only area the biotech is going after; it has exciting products across others. In the biosimilar realm, it recently launched Pavblu, a competitor to Regeneron Pharmaceuticals' blockbuster, Eylea, which treats an eye condition called wet age-related macular degeneration. Amgen should be able to overcome future losses of patent exclusivity for key products, even if it goes through periods of declining sales as a result. The stock should perform well in the long run and continue rewarding shareholders with regular dividends. The company has increased its payouts by 201% in the past decade so it currently offers a forward yield of 3.4% -- while the average for the S&P 500 is 1.3%. Amgen might not be as exciting as certain tech companies, but the stock looks like a strong buy-and-forget pick. Microsoft's shares struggled for much of the year. The threat of tariffs and the fear that they could lead to an inflationary environment or a recession (or both) weighed on many tech giants, including Microsoft. However, the company more or less put those fears to bed (for now) with its latest quarterly update, for the third quarter of its fiscal year 2025, ending March 31. Revenue jumped by 13% year over year to $70.1 billion. The tech leader can thank its cloud computing arm, Microsoft Azure, for that performance; the segment's revenue jumped by 33% (or 35% in constant currency) compared to the year-ago period. And there's more where that came from. In its fourth quarter, Microsoft expects Azure revenue to increase 34% to 35% in constant currency. So, despite economic uncertainty, the company is doing fine. The important lesson here isn't that its quarter was strong. It's that even during challenging times, Microsoft can perform relatively well. That's why the stock has thrived for decades, making longtime shareholders much wealthier. Microsoft's ability to navigate tough periods is one factor that makes it an attractive forever stock. Here are two more. First, the company has a strong moat from its brand name and switching costs within its cloud and software productivity businesses. Second, it has attractive long-term growth opportunities; cloud computing and artificial intelligence (AI) are the most exciting of the bunch. That means that even with a market capitalization above $3 trillion, Microsoft still has a bright future, and the company's dividend looks safe. It might only have a forward yield of 0.8%, but the rock-solid underlying business, ability to generate plenty of cash, and consistent dividend growth record (it's increased its payouts by 168% over the past 10 years) more than make up for the low yield. Microsoft is a top stock to hold on to for growth and income investors alike. Before you buy stock in Amgen, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Amgen wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $717,471!* Now, it's worth noting Stock Advisor's total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 5, 2025 Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amgen, Microsoft, and Regeneron Pharmaceuticals. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. 2 Unstoppable Dividend Stocks to Buy and Hold Forever was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
