Motley Fool investors may feel that they’ve missed the boat after last week. Trillium Therapeutics (TSX:TRIL)(NASDAQ:TRIL) announced that Big Pharma company Pfizer would be acquiring Trillium Therapeutics stock, sending shares jumping 188% in a single day!
As I wrote in a previous article, the details are simple. Pfizer will buy Trillium Therapeutics stock for US$2.26 billion, or about $18.50 per share. This is where Motley Fool investors might be upset. Shares of the company continue to trade around $22 per share since then and aren’t coming down much since the major jump.
But don’t fret! This recent deal just shows Big Pharma is moving toward the next stage: post-pandemic. We’ve learned a lot this past two years. And now it’s time to apply it to future growth. That’s why today I’m going to cover three pharma stocks I would buy instead of Trillium Therapeutics Stock, which frankly isn’t going to go down any time soon.
Bausch Health (TSX:BHC)(NYSE:BHC) is a top turnaround company. The pharma company is also looking for ways out of the pandemic, recently bringing down debt during its latest earnings report. The company was getting rid of non-core assets during the last year to hasten the process, along with “aggressive deal-making,” according to analysts.
But now the company is headed to the future, just as Trillium Therapeutics stock is as well. Bausch management announced a plan for an initial public offering (IPO) of its medical esthetics business, Solta Medical. This arm reported revenue in 2020 of US$253 million. Meanwhile, the company continues to grow its research and development arm as well.
Shares are now up 39% year to date but dropped back recently. Motley Fool investors can pick up the stock with a price-to-sales (P/S) ratio of 1.55 as of writing. With more growth on the way, it could be the perfect addition to pharma stocks.
You may already know them, but Jamieson Wellness (TSX:JWEL) is still one of the best stocks you can buy in the pharma industry right now. With a P/E ratio of 32, it’s not undervalued. However, it’s certain to continue doing well. Especially as the pandemic is put behind us in the years to come.
Jamieson latched on recently to growth in China, and as restrictions ease, this growth is certain to lead to increased revenue. But it’s not like the company suffered this last year. During the latest earnings report, revenue rose 18.6% year over year, with adjusted EBITDA up 17.6%.
As the company continues to expand into Asian markets and it continues its wellness product growth at low prices, investors should continue to be rewarded. You can continue to pick up the stock with a dividend yield of 1.68% and get the stock during a pullback of 7% over the last three months. That’s a far better option than Trillium Therapeutics stock right now.
Now if you want cheap and strong from your pharma company, look into Knight Therapeutics (TSX:GUD). The company has access to North and Latin American pharmaceutical healthcare products. Yet despite being cheap with a P/E ratio of 11.75, the company has been reporting record revenue again and again.
Most recently, Knight Therapeutics reported a 24% increase in year-over-year revenue, breaking a record in that time. Adjusted EBITDA also increased 23% year over year, but there’s even more growth available to this company.
Part of this growth comes from Health Canada’s approval of its breast cancer therapy. Shares have been growing since the news two months back after falling further and further during the pandemic. Shares are now down 15% in the last year, but up 7% in the last month.
The company remains with a strong balance sheet and a stellar potential upside of 42% as of writing. So this is definitely one Motley Fool investors should consider above Trillium Therapeutics stock.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Bausch Health Companies.