7 Drug Stocks to Buy Now why do investors invest in gold and silver

Shoppers may know johnson & johnson ( JNJ) for its band-aids and baby shampoo. But consumer products made up only a quarter of J&J’s $61.9 billion in 2009 sales. Medical devices and pharmaceuticals round out the pie, and analysts expect the drug division to post accelerating sales, thanks to a robust pipeline of new products and scant additional competition in generics through 2014. Drugs in advanced stages of development include new treatments for HIV, hepatitis C and epilepsy. And J&J has made deals with biotech firms to develop treatments for cancer, alzheimer’s disease and a genetically engineered “universal” flu vaccine that could work against all strains of the virus.

Overall, wall street expects J&J’s earnings to grow 6%, to $4.93 a share, this year.Why do investors invest in gold and silver

that gives J&J a P/E of 13 — an attractive price for a company with such impeccable finances. J&J is one of only four U.S. Nonfinancial companies with a coveted triple-A credit rating, and the $11.8 billion on the firm’s balance sheet gives it a lot of flexibility to make acquisitions, buy back shares or hike its annual dividend of $1.96 per share, which gives the stock, at $62.72, a yield of 3.1%.

Merck ( MRK) was plodding along with average growth prospects before it hooked up with schering-plough in a $41-billion deal last year. But the new merck has a much stronger pipeline, with drugs in development that could add $10.4 billion a year to the top line by 2015, says credit suisse analyst catherine arnold. With more than a dozen drugs in late-stage development, merck should easily be able to offset losses from big sellers, such as singulair, an asthma drug that goes generic in 2012.Why do investors invest in gold and silver schering also has several biotech drugs in the works, including a new fertility treatment. And merck is targeting $3.5 billion in total merger-related cost savings by 2012.

Merck faces risks, of course, and the stock could drop if studies of its blockbuster cholesterol drugs, vytorin and zetia, produce unfavorable results. But even with dwindling sales from those products, merck should generate earnings growth of 8.3% a year, on average, through 2015, on the upper end for the industry, says arnold. Her estimates are on the high side of wall street’s forecasts, but with a P/E of 11, the stock, at $36.92, still looks underpriced. (as part of its fourth-quarter earnings report, released february 16, merck said it expects to generate percentage earnings growth in the high-single digits through 2013.)

why do investors invest in gold and silver

The locomotive for abbott laboratories ( ABT) these days is humira, a biotech arthritis drug with sales rising 20% a year. Humira’s $5.5-billion haul made up 18% of abbott’s $30.8 billion in 2009 revenues. But the company cut its reliance on the drug last year by buying the pharmaceutical unit of belgian firm solvay, giving it full control of cardiovascular drugs tricor and trilipix and a larger business in emerging markets. Abbott has also expanded into medical optics, becoming the market leader in laser-vision devices. And its nutritional division, including baby formula brand similac, is growing fast in asia.

Abbott’s pipeline is on the weak side, says morningstar’s conover, and U.S. Sales of humira rose just 3% in the fourth quarter, disappointing wall street. But abbott’s drugs won’t face much generic competition until 2015, giving it plenty of time to acquire or license new products.Why do investors invest in gold and silver analysts are looking for a 14% gain in earnings this year, to $4.23 a share. And with the stock, at $53.93, trading at 13 times that figure, abbott looks reasonably valued.

While makers of brand-name drugs dread the patent cliff, teva pharmaceutical industries ( TEVA), the world’s largest maker of generic drugs, looks at it gleefully. The israeli company expects the global generics market to grow from $80 billion to at least $135 billion by 2015. It plans to double its revenues in that time frame, from $15.8 billion to $31 billion. And it aims to grow its brand-name drug business — now 30% of sales — becoming less dependent on its multiple-sclerosis treatment copaxone, which goes generic in 2014.

Investors might expect to pay a steep price for teva, one of the fastest growers in the industry.Why do investors invest in gold and silver but while the stock, at $58.86, has climbed 35% over the past year, it trades at just 13 times estimated 2010 earnings of $4.54 a share. And with profits climbing 15% to 20% annually, the shares look like they have plenty of room to run.

Shoppers may know johnson & johnson ( JNJ) for its band-aids and baby shampoo. But consumer products made up only a quarter of J&J’s $61.9 billion in 2009 sales. Medical devices and pharmaceuticals round out the pie, and analysts expect the drug division to post accelerating sales, thanks to a robust pipeline of new products and scant additional competition in generics through 2014. Drugs in advanced stages of development include new treatments for HIV, hepatitis C and epilepsy. And J&J has made deals with biotech firms to develop treatments for cancer, alzheimer’s disease and a genetically engineered “universal” flu vaccine that could work against all strains of the virus.Why do investors invest in gold and silver

Overall, wall street expects J&J’s earnings to grow 6%, to $4.93 a share, this year. That gives J&J a P/E of 13 — an attractive price for a company with such impeccable finances. J&J is one of only four U.S. Nonfinancial companies with a coveted triple-A credit rating, and the $11.8 billion on the firm’s balance sheet gives it a lot of flexibility to make acquisitions, buy back shares or hike its annual dividend of $1.96 per share, which gives the stock, at $62.72, a yield of 3.1%.

Merck ( MRK) was plodding along with average growth prospects before it hooked up with schering-plough in a $41-billion deal last year. But the new merck has a much stronger pipeline, with drugs in development that could add $10.4 billion a year to the top line by 2015, says credit suisse analyst catherine arnold.Why do investors invest in gold and silver with more than a dozen drugs in late-stage development, merck should easily be able to offset losses from big sellers, such as singulair, an asthma drug that goes generic in 2012. Schering also has several biotech drugs in the works, including a new fertility treatment. And merck is targeting $3.5 billion in total merger-related cost savings by 2012.

Merck faces risks, of course, and the stock could drop if studies of its blockbuster cholesterol drugs, vytorin and zetia, produce unfavorable results. But even with dwindling sales from those products, merck should generate earnings growth of 8.3% a year, on average, through 2015, on the upper end for the industry, says arnold. Her estimates are on the high side of wall street’s forecasts, but with a P/E of 11, the stock, at $36.92, still looks underpriced. (as part of its fourth-quarter earnings report, released february 16, merck said it expects to generate percentage earnings growth in the high-single digits through 2013.)

why do investors invest in gold and silver

The locomotive for abbott laboratories ( ABT) these days is humira, a biotech arthritis drug with sales rising 20% a year. Humira’s $5.5-billion haul made up 18% of abbott’s $30.8 billion in 2009 revenues. But the company cut its reliance on the drug last year by buying the pharmaceutical unit of belgian firm solvay, giving it full control of cardiovascular drugs tricor and trilipix and a larger business in emerging markets. Abbott has also expanded into medical optics, becoming the market leader in laser-vision devices. And its nutritional division, including baby formula brand similac, is growing fast in asia.

Abbott’s pipeline is on the weak side, says morningstar’s conover, and U.S. Sales of humira rose just 3% in the fourth quarter, disappointing wall street. But abbott’s drugs won’t face much generic competition until 2015, giving it plenty of time to acquire or license new products.Why do investors invest in gold and silver analysts are looking for a 14% gain in earnings this year, to $4.23 a share. And with the stock, at $53.93, trading at 13 times that figure, abbott looks reasonably valued.

While makers of brand-name drugs dread the patent cliff, teva pharmaceutical industries ( TEVA), the world’s largest maker of generic drugs, looks at it gleefully. The israeli company expects the global generics market to grow from $80 billion to at least $135 billion by 2015. It plans to double its revenues in that time frame, from $15.8 billion to $31 billion. And it aims to grow its brand-name drug business — now 30% of sales — becoming less dependent on its multiple-sclerosis treatment copaxone, which goes generic in 2014.

Investors might expect to pay a steep price for teva, one of the fastest growers in the industry.Why do investors invest in gold and silver but while the stock, at $58.86, has climbed 35% over the past year, it trades at just 13 times estimated 2010 earnings of $4.54 a share. And with profits climbing 15% to 20% annually, the shares look like they have plenty of room to run.