Amgen: An Underrated Giant Amidst Market Turbulence

In turbulent times in the pharmaceutical market, triggered by political developments, Amgen presents itself as a promising investment opportunity. The appointment of Robert F. Kennedy Jr. as Health Minister under the Trump administration initially raised concerns about potential disruptions in the healthcare industry. In particular, feared changes in insurance policy caused unrest. However, these fears may be exaggerated, as the pharmaceutical industry is supported by one of the strongest lobbying groups in Washington, which is likely to prevent extreme measures. Furthermore, the government approval of new drugs remains firmly anchored in scientific and procedural foundations, ensuring that doctors can continue to prescribe the best treatments for patients, regardless of political rhetoric. The sharp decline in pharmaceutical stocks following RFK's nomination could present a contrarian buying opportunity for long-term investors. Amgen, in particular, stands out due to its undervaluation and strong portfolio, including the experimental obesity drug MariTide. If MariTide is successful, it could significantly increase Amgen's valuation, with the stock price potentially lying between 350 and 400 dollars. Even in the event of MariTide's failure, Amgen's intrinsic value remains stable, with a projected stock valuation between 300 and 350 dollars. This asymmetric risk-reward profile, combined with solid fundamentals and potential growth factors, makes Amgen an attractive investment at the current price level. The exaggerated market behavior concerning political concerns offers the opportunity to invest in a high-quality company with substantial upside potential and benefit from advancements in Amgen's pipeline as well as a possible recovery in the broader pharmaceutical sector. Although Amgen is not on the list of the 31 most popular stocks among hedge funds, 68 hedge fund portfolios held shares at the end of the third quarter, compared to 69 in the previous quarter. While Amgen's risk and potential as an investment are recognized, some analysts see greater opportunities for higher and faster returns in AI stocks. Those seeking a cost-effective and promising AI stock should consider our report on the cheapest AI stock.