The biotechnology sector has been instrumental in bringing Covid-19 under control. It was not the traditional large pharmaceutical vaccine specialists that led the way, but the innovative biotech firms such as BioNTech and Moderna. These companies have turned a much-discussed idea – vaccines based on RNA, a new approach – into a product and have manufactured millions of doses. That has led to valuations of some of the innovative small-cap companies accelerating to eye-wateringly high levels.
It is easy to get caught up in the hype of investing in stocks with rapidly rising share prices. However, we rely on fundamental analysis in making our investment decisions and look out for companies that boast a compelling roster of innovative products. We also ensure that these companies have experienced managers to help the business deliver long-term growth. We also seek out stocks that are fairly valued and we do not chase overhyped small-cap biotechs. In our opinion, these three stocks have good pipelines, strong management teams and fair valuations.
Orphan diseases: a high-growth niche
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Tackling multiple maladies
Shifting from HIV to cancer
-
Annual house price growth halves to 3.5% – ONSAverage UK house prices rose by just 3.5% in the 12 months to April, as stamp duty changes deterred buyers. What’s the outlook for the rest of 2025?
-
Nationwide pays £100 to millions of people – have you received the payment?Nationwide has started paying its £100 Fairer Share bonus and expects to complete payments by 4 July. We look at who will get it and when.
-
The British railway industry is in rude health – here's why investors should jump aboardThe railway industry has bounced back from the devastating impact of the pandemic and is entering a new phase of development – and profitability
-
Infrastructure investing: a haven of stable growth amid market turmoilFrom booming construction in emerging markets to digital and green transitions, the infrastructure sector offers security, returns and long-term opportunities
-
Resilient and profitable performers will excel in the era of deglobalisationOpinion James Harries, co-manager, STS Global Income & Growth Trust, selects his favourite stocks as he shares where he'd put his money
-
The costly myth of “sell in May”Opinion May 2025's strong returns for US stocks have once again shown that putting too much weight on seasonal patterns will only make investors poorer, says Max King
-
Vietnam: a high-growth market going cheapOpinion The threat of tariffs has shaken Vietnamese stocks, but long-term prospects remain solid, says Max King
-
Who’s driving Tesla?As Elon Musk steps back from government with his eyes on the stars, investors ask if he’s still behind the wheel at his electric-car maker.
-
Growth trends such as low-carbon grids and AI boost key infrastructure — how to investOpinion Richard Sem, partner, head of Europe, and portfolio manager at Pantheon Infrastructure, highlights three favourites as he shares where he'd put his money
-
Investment opportunities in the world of Coca-ColaThere is far more to Coca-Cola than just one giant firm. The companies that bottle and distribute the ubiquitous soft drink are promising investments in their own right.
