In this article, we will look at the 10 Best Medical Research Stocks to Buy According to Hedge Funds.
On January 27, Sarah James, Cantor Fitzgerald analyst, appeared on CNBC’s ‘Squawk on the Street’ to talk about the healthcare insurance sector and the stocks coming under pressure. Calling this “another great opportunity to buy”, she stated that we have a dislocation in Medicare Advantage. When she looks across what is happening to the stocks, it’s really not allocating correctly, with some companies heavily exposed to Medicare Advantage, while others have a very consistent, strong pricing discipline, diversified book that are getting taken down with the group, and they really shouldn’t be.
She is hoping that it gets better, stating that typically in the next two months, there is going to be a revision with it going up by a couple of hundred basis points. However, the backdrop of this issue is the rates of insufficient cover costs for seniors for several years. Expectations were that this was the year, 2027, that things were going to start aligning and getting better, but instead, we saw CMS going in the opposite direction.
READ ALSO: 13 Oversold NASDAQ Stocks to Invest In and 12 Best Healthcare Stocks Under $50 to Invest In.
In addition, they put in some additional headwinds that are debatable at best on whether they are accurately representing what is happening in the coding environment. She is hoping for a robust conversation back and forth between the government and the payers over the next couple of months, and a positive revision. That said, James was of the view that we are not in the environment we thought we would be in, and it is probably going to end up in some exits, which will likely be challenging for seniors come 2027. She added that the rate proposal shows more political influence than before, and that the final rate announcement is expected in early mid-April.
With these trends in view, let’s look at the best medical research stocks to buy according to hedge funds.
Our Methodology
We used stock screeners to find the best medical research stocks and then chose the top 10 with the highest number of hedge fund holders, as of Q3 2025. We sourced the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund holders.
Note: All data was recorded on February 12.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10 Best Medical Research Stocks to Buy According to Hedge Funds
10. Biogen Inc. (NASDAQ:BIIB)
Number of Hedge Fund Holders: 59
Biogen Inc. (NASDAQ:BIIB) is one of the best medical research stocks to buy according to hedge funds. On February 10, Wedbush lifted the price target on Biogen Inc. (NASDAQ:BIIB) to $187 from $178, maintaining a Neutral rating on the shares. The firm told investors that Biogen Inc. (NASDAQ:BIIB) delivered another top-/bottom-line beat in its fiscal Q4 and full year 2025 financial results, and commended the management’s efforts in realigning the cost base. However, it added that revenue growth drivers are the critical missing piece for the turnaround story.
RBC Capital also adjusted the price target on Biogen Inc. (NASDAQ:BIIB) to $233 from $217 on February 9, maintaining an Outperform rating on the shares. According to the firm, the company successfully delivered its key objective of showing stability and predictability in the quarter, both in guidance and numbers. It believes that the company has a solid foundation for a catalyst-rich next year, supported by factors such as solid commercial execution, growth across key franchises, and improved expense discipline.
Biogen Inc. (NASDAQ:BIIB) also received a rating update from BMO Capital the same day, which revised the price target on the stock to $196 from $165 and maintained a Market Perform rating on the shares after its fiscal Q4 earnings beat.
Biogen Inc. (NASDAQ:BIIB) is a global biopharmaceutical company that discovers, develops, and delivers advanced therapies for serious diseases across the globe. Its medicine portfolio treats multiple sclerosis (MS), spinal muscular atrophy (SMA), Alzheimer’s disease, and amyotrophic lateral sclerosis (ALS). The company has an elaborate marketed product portfolio for MS, including TECFIDERA, VUMERITY, AVONEX, PLEGRIDY, TYSABRI, and FAMPYRA. It also markets SPINRAZA to treat SMA, SKYCLARYS for the treatment of Friedreich’s Ataxia, and other drugs.
9. Gilead Sciences, Inc. (NASDAQ:GILD)
Number of Hedge Fund Holders: 61
Gilead Sciences, Inc. (NASDAQ:GILD) is one of the best medical research stocks to buy according to hedge funds. On February 11, BofA lifted the price target on Gilead Sciences, Inc. (NASDAQ:GILD) to $162 from $154, maintaining a Buy rating on the shares. The firm told investors in a post-earnings note that it is confident in 2026 growth for the company due to solid fiscal Q4 dynamics, adding that it no longer models Yeztugo cannibalization of Descovy sales in 2026.
The rating update came after Gilead Sciences, Inc. (NASDAQ:GILD) announced its fiscal Q4 and full year 2025 results on February 10, stating that 2025 was a strong year for the company overall, marked by the successful launch of Yeztugo, which is the world’s first twice-yearly HIV prevention therapy in the country, and the continued growth for Biktarvy and Descovy.
Gilead Sciences, Inc. (NASDAQ:GILD) further reported that the total fiscal Q4 revenues rose 5% to $7.9 billion compared to the prior year period, driven primarily by the increased sales of HIV and Liver Disease products and partially offset by lower sales of Veklury®.
Gilead Sciences, Inc. (NASDAQ:GILD) is a biotech company that advances medicines to prevent and treat serious diseases such as cancer, immunodeficiency virus (HIV), viral hepatitis, and COVID-19. Its portfolio of drugs focuses on medical areas with unmet needs, and includes AmBisome, Atripla, Biktarvy, Cayston, Complera, and others.
8. Amgen Inc. (NASDAQ:AMGN)
Number of Hedge Fund Holders: 62
Amgen Inc. (NASDAQ:AMGN) is one of the best medical research stocks to buy according to hedge funds. Amgen Inc. (NASDAQ:AMGN) received rating updates from Argus Research and Guggenheim on February 6. Argus reiterated a Buy rating on the stock with a $400 price target, while Guggenheim reaffirmed a Hold rating on Amgen Inc. (NASDAQ:AMGN) and set a price target of $347.
The rating updates came after Amgen Inc. (NASDAQ:AMGN) reported its fiscal Q4 and full year 2025 results on February 3, announcing strong performance in 2025 with double-digit growth in revenues and EPS. Total revenues for fiscal Q4 rose 9% to $9.9 billion compared to the prior year period, with product sales growing 7%, driven by 10% volume growth. Total revenues for the full year reached $36.8 billion, up 10% compared to the same quarter last year.
Amgen Inc. (NASDAQ:AMGN) further reported that product sales grew 10%, driven by 13% volume growth, partially offset by 3% lower net selling price. 18 of the company’s products attained record sales for the full year, while 14 products exceeded one billion dollars in annual sales. Amgen Inc. (NASDAQ:AMGN) expects total revenues in the $37.0 billion to $38.4 billion range for the full year 2026.
Amgen Inc. (NASDAQ:AMGN) is a biotechnology company that discovers, develops, manufactures, and markets human therapeutics. It delivers new therapies for patients with complex cancers, especially in areas with significant unmet needs.
7. Bristol-Myers Squibb Company (NYSE:BMY)
Number of Hedge Fund Holders: 76
Bristol-Myers Squibb Company (NYSE:BMY) is one of the best medical research stocks to buy according to hedge funds. Bernstein reiterated its Hold rating on Bristol-Myers Squibb Company (NYSE:BMY) on February 10 and set a price target of $58.00. Bristol-Myers Squibb Company (NYSE:BMY) also received a rating update from Morgan Stanley on February 6, which lifted the price target on the stock to $40 from $37 while keeping an Underweight rating on the shares. The firm told investors in a research note that while the 2026 revenue and EPS guidance exceeded consensus, it was driven by a higher-than-expected Eliquis guide.
In addition to Morgan Stanley, BofA also raised the price target on Bristol-Myers Squibb Company (NYSE:BMY) to $68 from $64 on February 6 and maintained a Buy rating on the shares. The firm lifted its near-term forecasts after the company delivered fiscal Q4 and FY26 guidance beats, telling investors that Bristol-Myers Squibb Company (NYSE:BMY) “is a pipeline story”.
The same day, Guggenheim also raised the price target on the stock to $72 from $62, maintaining a Buy rating on the shares and raising its view of the odds of success to 90% for iber/mezi from the previous 33%. The firm also increased its view of the odds of success to 90% from 75% prior for milvexian in SSP, stating that it is continuing to recommend that investors buy shares ahead of the company’s “series of high-profile, potentially high-reward” Phase 3 catalysts.
Bristol-Myers Squibb Company (NYSE:BMY) is a biopharmaceutical company that discovers, develops, and delivers advanced medicines for serious diseases. Its medicines fall into various therapeutic classes, including hematology, oncology, cardiovascular, immunology, and neuroscience.
6. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN)
Number of Hedge Fund Holders: 78
Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is one of the best medical research stocks to buy according to hedge funds. RBC Capital reiterated a Hold rating on Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) on February 10, setting a price target of $745.00.
In another development, Guggenheim lifted the price target on Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) to $975 from $865 on February 9, maintaining a bullish outlook with a Buy rating. The firm updated its model on the company after its earnings, and told investors that it sees key upcoming catalysts for the company, including the fianlimab/Libtayo LAG-3 data in melanoma, an FDA decision for the Eylea HD pre-filled syringe in Q2, and an NDA submission for cemdisiran in generalized myasthenia gravis in Q1.
Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) also received a rating update from Oppenheimer on February 2, which lifted the price target on the stock to $865 from $750 while keeping an Outperform rating on the shares. It noted that Regeneron Pharmaceuticals, Inc.’s (NASDAQ:REGN) reported fiscal Q4 earnings were largely in-line with consensus estimates, and stated that the fiscal Q4 call sounded refreshingly optimistic after four consecutive quarters of EYLEA’s troubles dominating the discussion.
Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is a pharmaceutical company that develops, discovers, and commercializes therapies for several diseases, including cancer, eye disorders, and allergic conditions.
5. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 84
Pfizer Inc. (NYSE:PFE) is one of the best medical research stocks to buy according to hedge funds. Pfizer Inc. (NYSE:PFE) announced on February 6 that the U.S. Food and Drug Administration accepted and granted Priority Review for its supplemental Biologics License Application for HYMPAVZI® for the expansion of the approved indication to include treatment of hemophilia A or B patients 6 years and older with inhibitors, and pediatric patients with hemophilia A or B without inhibitors. HYMPAVZI currently holds approval for the treatment of patients 12 years of age and older with hemophilia A without factor VIII inhibitors, or hemophilia B without factor IX inhibitors in the United States.
Pfizer Inc. (NYSE:PFE) further reported that the FDA set a Prescription Drug User Fee Act action date in Q2 2026. If approved, HYMPAVZI would provide a combination of bleed protection with a straightforward, once-weekly subcutaneous injection administration that requires minimal preparation without a need for routine treatment-related lab monitoring for these difficult-to-treat patient populations.
In another development, Citi reaffirmed its Hold rating on Pfizer Inc. (NYSE:PFE) on February 4, setting a $26 price target. The company released its fiscal Q4 and full-year 2025 results on February 3, announcing full-year revenues of $62.6 billion, reflecting a 2% year-over-year operational decline. It added that revenues grew 6% operationally when excluding contributions from Paxlovid and Comirnaty. Fiscal Q4 revenues came up to $17.6 billion, highlighting a 3% year-over-year operational decline.
Pfizer Inc. (NYSE:PFE) is a global biopharmaceutical company that manufactures, develops, markets, and sells biopharmaceutical products worldwide. It advances wellness, prevention, treatment, and cures in developing and emerging markets.
4. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 92
Merck & Co., Inc. (NYSE:MRK) is one of the best medical research stocks to buy according to hedge funds. Merck & Co., Inc. (NYSE:MRK) announced on February 11 the FDA approval of KEYTRUDA® and KEYTRUDA QLEX™ plus paclitaxel, with or without bevacizumab, for the treatment of adults with PD-L1+, as determined by an FDA-authorized test, platinum-resistant epithelial ovarian, fallopian tube, or primary peritoneal carcinoma, who have received one or two prior systemic treatment regimens. Management stated that KEYTRUDA and KEYTRUDA QLEX mark the first and only PD-1 inhibitors approved for adults with platinum-resistant epithelial ovarian, fallopian tube, or primary peritoneal carcinoma with PD-L1+ tumors.
The approvals were based on the Phase 3 KEYNOTE-B96 trial that showed the KEYTRUDA regimen lowered the risk of disease progression or death by 28%, and reduced the risk of death by 24% compared to placebo plus paclitaxel with or without bevacizumab.
Merck & Co., Inc. (NYSE:MRK) stated that KEYTRUDA QLEX’s effectiveness for its approved indications was supported by the adequate and well-controlled studies conducted with KEYTRUDA, along with additional data from MK-3475A-D77 comparing the pharmacokinetic, efficacy, and safety profiles of KEYTRUDA QLEX and KEYTRUDA.
Merck & Co., Inc. (NYSE:MRK) is a biopharmaceutical company that delivers health solutions to advance the treatment and prevention of diseases in animals and people. Its Pharmaceutical segment offers vaccines and human health pharmaceutical products, typically therapeutic and preventive agents. Its Animal Health segment develops, discovers, manufactures, and markets a range of vaccines and veterinary pharmaceutical products.
3. AbbVie Inc. (NYSE:ABBV)
Number of Hedge Fund Holders: 93
AbbVie Inc. (NYSE:ABBV) is one of the best medical research stocks to buy according to hedge funds. AbbVie Inc. (NYSE:ABBV) received rating updates from Guggenheim and UBS on February 5, with Guggenheim reaffirming a Buy rating on the stock with a $242 price target and UBS revising the price target to $230 from $240 while keeping a Neutral rating on the shares.
Evercore ISI also adjusted the price target on AbbVie Inc. (NYSE:ABBV) on February 4, maintaining an Outperform rating on the stock and lowering the price target to $228 from $232. The firm told investors in a research note that despite Tremfya clearly taking share, the 2026 guidance/consensus still looks beatable, same with 2027. It further stated that it is “worth noting” that the buy-side has been above consensus for a while, and the margin beats look smaller, adding that the real complication is 2028+ growth, especially with more new entrants coming online.
The rating updates came after AbbVie Inc. (NYSE:ABBV) reported its fiscal Q4 and full-year 2025 results on February 4, delivering full-year net revenues of $61.160 billion, up 8.6% on a reported basis and up 8.5% on an operational basis. The company further reported full-year diluted EPS of $2.36 on a GAAP basis, reflecting a decrease of 1.3%, and an adjusted diluted EPS of $10.00, down 1.2%. Management reported that the results included an unfavorable impact of $2.76 per share related to the 2025 acquired IPR&D and milestones expense.
AbbVie Inc. (NYSE:ABBV) is a research-based pharmaceutical company that develops and sells products to treat chronic diseases in oncology, gastroenterology, rheumatology, dermatology, virology, and various other serious health conditions.
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 103
Johnson & Johnson (NYSE:JNJ) is one of the best medical research stocks to buy according to hedge funds. Johnson & Johnson (NYSE:JNJ) announced 12-month pilot-phase data from the OMNY-AF study on February 6 at the 31st Annual AF Symposium in Boston, evaluating the investigational OMNYPULSE Platform for the treatment of symptomatic paroxysmal atrial fibrillation. It reported that the initial results for 12-month outcomes across the 30-patient pilot cohort reflect that investigators attained 100% acute procedural success with no procedure-associated adverse events, while 56.7% of cases were performed with zero fluoroscopy, and 90% of patients achieved primary effectiveness at 12 months.
In another development, RBC Capital raised the price target on Johnson & Johnson (NYSE:JNJ) to $255 from $240 on February 3, maintaining an Outperform rating on the shares. It further stated that it is unlikely for the key implications of the Daubert ruling to be undone. However, it added that the cases may drag on for years as Johnson & Johnson (NYSE:JNJ) litigates this case-by-case and year-by-year, maintaining a strong financial position by enhancing business fundamentals to help mitigate risks.
In another development, BofA lifted the price target on Johnson & Johnson (NYSE:JNJ) to $227 from $221 on January 30 while maintaining a Neutral rating on the shares. The firm told investors that the increased price target points towards a higher blended P/E multiple, which in turn assumes a raised MedTech multiple on a higher pharma multiple and higher organic growth, given a defensive premium.
Johnson & Johnson (NYSE:JNJ) develops, manufactures, and sells products in the healthcare field. The company operates through two segments: Innovative Medicine and MedTech. The Innovative Medicine segment focuses on various therapeutic areas, including oncology, infectious diseases, immunology, cardiovascular and metabolic diseases, and others. The MedTech segment includes an elaborate range of medical devices and products used in cardiovascular intervention, orthopedics, interventional solutions, surgery, and vision fields.
1. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 114
Eli Lilly and Company (NYSE:LLY) is one of the best medical research stocks to buy according to hedge funds. On February 10, Eli Lilly and Company (NYSE:LLY) was upgraded to Buy from Hold by Freedom Capital, with the firm raising the price target on the stock to $1,200 from $1,050. The rating update came after what the firm called “another quarter that beat even the high-end of revenue and EPS estimates,” driven by record GLP-1 sales. It further supported the optimistic rating with the company’s “dominant position” in the GLP-1 market, along with the long-term potential from an oral drug launch.
In another development, Eli Lilly and Company (NYSE:LLY) announced entry into a definitive agreement to acquire Orna Therapeutics, Inc., a biotechnology company involved in engineering immune cells in vivo. Management reported that Orna is advancing a new class of therapeutics utilizing engineered circular RNA paired with novel lipid nanoparticles to allow the patient’s own body to generate cell therapies that can treat underlying disease. Its lead program is ORN-252, which is a clinical trial-ready, CD19-targeting in vivo Chimeric Antigen Receptor T-cell therapy designed to treat B cell-driven autoimmune diseases.
The terms of the agreement entail that Eli Lilly and Company (NYSE:LLY) will acquire Orna, and the latter’s shareholders could receive up to $2.4 billion in cash, inclusive of an upfront payment and subsequent payments upon attainment of certain clinical development milestones.
Eli Lilly and Company (NYSE:LLY) develops, manufactures, discovers, and sells pharmaceutical products. These products span oncology, diabetes, immunology, neuroscience, and other therapies.
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