15 Small-Cap Healthcare Stocks Hedge Funds Are Buying

In this article, we will take a look at the 15 Small-Cap Healthcare Stocks Hedge Funds Are Buying.

The U.S. healthcare sector has performed better in 2025 compared to the broader market. After two years of weak performance, the healthcare sector kicked off on a strong note in 2025. In a letter from Federated Hermes, within the S&P 500, the healthcare sector soared nearly 2.59% as of April 30. Whereas the Information Technology sector reported an 11.24% loss, the Consumer Discretionary sector was down 14.08%, and the S&P 500 recorded a 4.92% decline as a whole.

READ ALSO: Why These 15 Healthcare Stocks Are Surging in 2025

As inflation eases, things will be better economically for the healthcare sector. The Investment Director of Federated Hermes, Jordan Stuart, mentioned that when inflation has eased historically, healthcare stocks have performed better. Stuart added:

“Typically, healthcare stocks underperform when inflation is high due to increased costs and pricing pressures. However, inflation has, ever so slowly, begun to decline again, and optimism around rate cuts has resurfaced, giving life back to healthcare stocks. This shift in economic conditions will likely enhance the attractiveness of health care investments, as lower inflation and interest rates create a more favourable environment for growth and profitability.”

According to BlackRock, an average of 75% of healthcare companies exceeded earnings expectations in the first three quarters of 2024. This led to an improved local investor sentiment, with nearly $80 million of inflows to the iShares Global Healthcare ETF (IXJ) in 2024. BlackRock expects the 2025 projected earnings in the healthcare sector to rebound even further, recording the highest year-over-year growth in 18 years, excluding the COVID-19 period.

The U.S. Healthcare Sector Outlook and Tariff Impact

The U.S. healthcare sector now accounts for a fifth of the U.S. economy. With digital transformation, non-acute care shifts, and innovation in biosimilars and speciality drugs, the healthcare sector remains poised for growth in 2025. According to SNS Insider Research, the healthcare market is expected to reach $44.76 trillion in 2032 from $21.22 trillion reported in 2023. This marks a CAGR of 9.07% between 2024 and 2032. North America accounts for almost 44% of the global healthcare market share.

Trump’s tariffs remain a major hurdle for healthcare, and they may threaten around a 10-15% cost increase for drugs and medical devices, as per Forbes. According to the Medical Device Network, around 69% of the U.S.-marketed medical devices are manufactured outside of the U.S.

David Risinger from Leerink Partners highlighted that potential tariffs would likely drive the U.S. drug prices, even though the companies moved their production to the U.S. Reducing costs with domestic production could take years, added Risinger. Reportedly, President Trump is expected to sign an executive order to slash U.S. prescription drug prices. The President plans to match drug prices overseas and control the price hike anticipated by analysts.

Lately, the U.S. government has been striving to make trade deals with its partners. After talks between the U.S. and China, both countries have decided to slash tariffs for 90 days, with duties set to drop by 115 percentage points. This move will drop American tariffs on Chinese goods to as low as 30%, and China’s retaliatory duties will go down from 125% to 10%.

With that, let’s take a look at the 15 Small-Cap Healthcare Stocks Hedge Funds Are Buying.

15 Small-cap Healthcare Stocks Hedge Funds Are Buying

A close-up of a healthcare professional studying a computer screen with data while consulting with a patient.

Our Methodology

To compile the list of the 15 small-cap healthcare stocks hedge funds are buying, we used the Finviz screener to shortlist healthcare stocks that are trading at a market cap of at least $10 billion. For this article, we are defining small-cap stocks as those that trade between $10 billion and $20 billion. We have ranked the stocks in ascending order of the number of hedge fund holders. Data for the number of hedge fund investors for each stock was taken from Insider Monkey’s database, updated as of Q4 2024. In cases where two or more stocks were held by an equal number of hedge funds, we used the upside potential as a tiebreaker. The analysts’ upside potential data is taken from CNN. Please note that the data was collected on May 13, 2025.

Why are we interested in the stocks that hedge funds and billionaire investors 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

15 Small-Cap Healthcare Stocks Hedge Funds Are Buying

15. DaVita Inc. (NYSE:DVA)

No. of Hedge Fund Holders: 46

Market Capitalization: $10.99 Billion

Analyst Upside: 18.36%

DaVita Inc. (NYSE:DVA) is a global healthcare company transforming its operations from solely a dialysis provider to offering more comprehensive kidney services. Along with kidney care services, DaVita has established nephrology and payor relationships. The company currently serves more than 281,000 patients.

In 2024, DaVita Inc. (NYSE:DVA) made notable progress with $12.8 billion in revenue and $2.1 billion in operating income, up by 5.6% and 30.4% year-over-year, respectively. The company is expected to benefit from continued strength in its revenue cycle operations during the first quarter of 2025. During Q4 2024, the company confirmed three of four acquisitions in Latin America, with the Brazil deal getting approved in April. The company is progressing in providing sustainable, integrated care through the Integrated Kidney Care business across the region.

During Q1 2025, analysts at Wall Street expect DaVita Inc. (NYSE:DVA) to post revenue of around $3.22 billion, representing 5% growth year-over-year. The earnings are projected to reach $1.75, down by 26.5% from a year ago. The earnings might get hit by the closure of Baxter’s North Cove facility due to Hurricane Helene and the related impact on home dialysis. This led to lower new admits during Q4, and the management expects this to negatively affect volume growth in 2025.

14. ICON Public Limited Company (NASDAQ:ICLR)

No. of Hedge Fund Holders: 46

Market Capitalization: $11.03 Billion

Analyst Upside: 33.74%

ICON Public Limited Company (NASDAQ:ICLR), a Contract Research Organization (CRO), is a healthcare intelligence and clinical research firm. The company offers services to pharmaceutical companies that need to conduct clinical trials. Drug companies outsource ICON’s services instead of conducting complex and costly processes in-house. ICON manages everything from patient recruitment to regulatory compliance.

ICON Public Limited Company (NASDAQ:ICLR) recently posted its Q4 results with its adjusted earnings around $3.19, beating estimates by $0.10 per share. The revenue came in at $2 billion, slightly short of the consensus estimate and a year-over-year decline of 4.6%. The company experienced high levels of cancellations in Q1, impacting overall bookings.

However, on the positive side, the company posted a better-than-expected adjusted EBITDA margin of 19.5%, indicating effective cost control and resource allocation. ICON saw a major increase in overall opportunities in the Biotech segment, with a modest win rate of closing projects. The company’s shift towards increased R&D spending, AI-driven drug discovery, and global diversification of trials reflects a structural growth opportunity. During Q1, the company launched two new AI-enabled tools, iSubmit and SmartDraft. These AI tools will improve operational efficiencies and accelerate clinical trials. In Q1, the company repurchased shares worth $250 million, highlighting its commitment to returning capital to shareholders.

13. Molina Healthcare, Inc. (NYSE:MOH)

No. of Hedge Fund Holders: 48

Market Capitalization: $16.87 Billion

Analyst Upside: 17.23%

Molina Healthcare, Inc. (NYSE:MOH) is a Fortune-500 healthcare services company operating under the Medicaid and Medicare programs. The company also engages through the state insurance marketplaces. Serving over 5.8 million customers across the U.S., Molina operates through four segments, including Medicaid, Medicare, Marketplace, and Other.

Molina Healthcare, Inc. (NYSE:MOH) posted strong results during the first quarter of 2025. The company reported a total revenue of $11.15 billion, beating estimates by $333.22 million. The adjusted earnings came in at $6.08 per share, surpassing estimates by $0.12. This growth was fueled by new contract wins, rate increases, and acquisitions. Molina’s medical care ratio was reported at around 89.2%, representing robust medical cost management. At the same time, the general and administrative expense ratio improved, with a 6.8% reduction. The company has reaffirmed its full-year 2025 guidance, with premium revenue projected to reach nearly $42 billion, reflecting a 9% increase from 2024. The adjusted EPS is expected to be around $24.50, indicating 8% growth.

On April 9, Ann Hynes from Mizuho increased the price target on MOH from $376 to $400, maintaining an Outperform rating on the shares. The analyst remains optimistic following a survey that suggests higher inpatient and outpatient growth trends during Q1.

12. Universal Health Services, Inc. (NYSE:UHS)

No. of Hedge Fund Holders: 49

Market Capitalization: $12.56 Billion

Analyst Upside: 14.10%

Universal Health Services, Inc. (NYSE:UHS) is a holding company that operates through its subsidiaries and its management company. The company owns and operates acute care hospitals, outpatient facilities, and behavioural healthcare facilities. The company’s segments include acute care hospital services, behavioural health care services, and Others. Universal Health Services has over 359 inpatient facilities, and 60 outpatient and other facilities in the U.S., the U.K., and Puerto Rico.

Universal Health Services, Inc. (NYSE:UHS) recently reported its first-quarter earnings and revenue. The company posted $4.10 billion in revenues, up by 6.70% year-over-year and slightly missing the estimates. The company posted adjusted earnings of $4.84, surpassing estimates by $0.49 per share. Same facility net revenues in the acute care hospital segment soared over 5% year-over-year. UHS saw a 21% rise in EBITDA from a year ago, excluding Medicaid supplement payments. Moreover, West Henderson Hospital in Las Vegas opened in late 2024, adding to the EBITDA in Q1.

Recently, Jason Cassorla from Guggenheim initiated coverage of the stock with a Buy rating and a price target of $208. The analyst mentions UHS’ position to benefit from its strong acute care hospital footprint, which is anticipated to lead to top-line growth compared to its competitors. Moreover, the growing demand for behavioural and mental health services is expected to be a positive driver for the company.

11. Incyte Corporation (NASDAQ:INCY)

No. of Hedge Fund Holders: 49

Market Capitalization: $11.80 Billion

Analyst Upside: 18.21%

Incyte Corporation (NASDAQ:INCY) is a biopharmaceutical firm focused on the discovery, development, and commercialization of therapeutics. The company operates in two therapeutic areas, including Haematology, and Inflammation and Autoimmunity. In Haematology, Incyte deals with diseases linked to bone marrow and bone marrow transplant, while the Inflammation and Autoimmunity includes its Dermatology commercial franchise.

Incyte Corporation (NASDAQ:INCY) had a good start to 2025 with strong financial performance during Q1. The company’s total revenue reached $1.05 billion, up by 20% from a year ago and beating estimates by $55.28 million. The adjusted earnings came in at $1.16 per share, surpassing the consensus estimate by $0.11. This growth was driven by net revenue increases in Incyte’s leading medications, including Jakafi and Opzelura. Jakafi’s net revenue was reported to be around $709 million, a 24% increase year-over-year. Opzelura’s revenue increased 38% from a year ago, fueled by growth in the U.S. and European markets. In addition, the company also completed the successful launch of Niktimvo, a treatment for adults and children with chronic graft-versus-host disease (cGVHD) weighing at least 40 kg. Niktimvo contributed almost $14 million to net product revenue in Q1. Incyte is planning to improve its pipeline and launch multiple products in 2025, reflecting potential for future growth.

10. BioMarin Pharmaceutical Inc. (NASDAQ:BMRN)

No. of Hedge Fund Holders: 51

Market Capitalization: $11.53 Billion

Analyst Upside: 60.73%

BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) is a biotech firm that develops and commercializes treatments for life-threatening rare diseases and medical conditions. The company offers its therapies to speciality pharmacies, pharmaceutical wholesalers, hospitals, distributors, and non-U.S. government agencies. BioMarin has license and partnership agreements with Ares Trading and Catalyst Pharmaceutical.

On May 5, Joon Lee from Truist Financial maintained a Buy rating on BMRN shares with a price target of $92. The analyst kept the rating following solid quarterly results during Q1. BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) posted a total revenue of $745.15 million, up by 15% from a year ago and surpassing estimates by $6.48 million. The company’s adjusted earnings came in at $1.13 per share, up by a whopping 59% and exceeding the consensus of $0.95 per share. The company’s leading therapy VOXZOGO’s global revenue reached $214 million, recording a 40% rise year-over-year. The company is now testing VOXZOGO in its pivotal Phase III trial with children suffering from hypochondroplasia. The company is aiming for a potential launch of VOXZOGO for children with hypochondroplasia in 2027.

9. The Cooper Companies, Inc. (NASDAQ:COO)

No. of Hedge Fund Holders: 52

Market Capitalization: $16.49 Billion

Analyst Upside: 29.67%

Incorporated back in 1958, The Cooper Companies, Inc. (NASDAQ:COO) is a leading global medical device firm. The company operates through two units: CooperVision and CooperSurgical. CooperVision is engaged in the contact lens industry, while CooperSurgical deals with fertility and women’s healthcare.

The Cooper Companies, Inc. (NASDAQ:COO) is well on track to record another strong quarter. The company has surpassed earnings estimates in all four past quarters. However, the COO missed revenue in Q1 due to CooperSurgical’s seasonality. During Q2, the company is expected to post earnings of $0.92 per share, up by 9.5% from a year ago, driven by CooperVision’s daily lens growth and margin expansion. Analysts project the revenue to be around $995 million, up by almost 7.4% year-over-year. For the full year 2025, the company is anticipated to generate revenue between $4.08 billion and $4.16 billion, indicating 6-8% organic growth.

On the Street, COO stock sports a consensus Strong Buy rating. The average price target of $108.56 implies an upside of 33% from current levels.

8. Biogen Inc. (NASDAQ:BIIB)

No. of Hedge Fund Holders: 52

Market Capitalization: $18.09 Billion

Analyst Upside: 33.45%

Biogen Inc. (NASDAQ:BIIB) is a global biopharmaceutical company that is focused on discovering, developing, and delivering advanced treatments for patients suffering from serious and complex diseases. Biogen operates various portfolios of medicines to treat Alzheimer’s disease, amyotrophic lateral sclerosis (ALS), multiple sclerosis (MS), and spinal muscular atrophy (SMA). The company is aiming to advance its pipeline in neurology, specialized immunology, and rare diseases.

On May 5, Andrew Fein from H.C. Wainwright reiterated a Buy rating on BIIB, reducing the price target from $241 to $187. The price target still implies an upside of almost 34% from the current price levels, as of May 13. The analyst has reduced the price target due to concerns over MS revenue decline and potential tariff impacts. However, Fein remains positive about Biogen’s LEQEMBI growth in the Alzheimer’s market and its broader pipeline.

Biogen Inc. (NASDAQ:BIIB) posted a revenue of $2.43 billion during Q1 2025, surpassing estimates by $197.78 billion and up 6% year-over-year. The company posted a significant increase in revenue from new product launches, accounting for 45% of product revenue. LEQEMBI’s marketing approval in the EU marks a major regulatory backing for its efficacy and safety profile. The company maintains a strong cash position of around $2.6 billion as of Q1 2025. With a pipeline of five Phase III studies starting in 2025, growth opportunities will open for Biogen.

7. Zimmer Biomet Holdings, Inc. (NYSE:ZBH)

No. of Hedge Fund Holders: 53

Market Capitalization: $19.29 Billion

Analyst Upside: 6.68%

Zimmer Biomet Holdings, Inc. (NYSE:ZBH) is a global medical device technology company. The company operates through four main segments: the Americas, Europe, the Middle East and Africa (EMEA), and Asia Pacific. Zimmer Biomet designs, manufactures, and markets orthopaedic reconstructive products. The company offers several other products, including biologics, sports medicine, dental implants, trauma products, and related surgical equipment. ZBH maintains a healthy share of 36% in knee implants, leading the orthopaedic sector. It has a 23% share in hip implants.

Zimmer Biomet Holdings, Inc. (NYSE:ZBH) posted a modest 1.1% revenue growth of $1.91 billion during Q1 2025, surpassing estimates by $13.77 million. The increase in revenue was driven by strong performance in U.S. Hips and mid-single-digit growth in S.E.T. For the full year 2025, the company expects the revenue to grow between 3% and 5% on constant currency, excluding the Paragon 28 acquisition.

On May 6, David Roman from Goldman Sachs reduced the price target on ZBH from $120 to $104, keeping a Neutral rating on the shares. The analyst has reduced the price following a lower earnings outlook for 2025. The company updated its 2025 adjusted earnings guidance of $7.90 to $8.10, reducing from the previous guidance of $8.15 to $8.35. The company is expected to face a $60 million to $80 million headwind from tariffs in 2025. Despite the short-term headwinds, Zimmer Biomet Holdings is working on innovation and diversification, with new product launches including the Iodine-Surface-Treated Hip Stem and the Oxford partial Cementless Knee. The company is also focused on its U.S. sales channel and optimizing its ASC offerings and robotic platforms.

6. Neurocrine Biosciences, Inc. (NASDAQ:NBIX)

No. of Hedge Fund Holders: 57

Market Capitalization: $11.73 Billion

Analyst Upside: 37.11%

Neurocrine Biosciences, Inc. (NASDAQ:NBIX) is a biopharmaceutical company engaged in developing treatments for neurological, neuroendocrine, and neuropsychiatric disorders. Neurocrine Biosciences has a robust pipeline focused on depression, epilepsy, and schizophrenia, working in collaboration with Takeda, Idorsia, and Voyager.

On May 6, Needham raised its price target on NBIX from $138 to $139, giving a Buy rating to the stock. The price update reflects Neurocrine Biosciences’ positive outlook for Ingrezza, NBIX’s flagship product for the treatment of tardive dyskinesia.

Neurocrine Biosciences, Inc. (NASDAQ:NBIX) reported strong quarterly results in Q1 2025. The company noted record new patient stats for INGREZZA, indicating robust market demand. On top of that, the company launched CRENESSITY, which achieved nearly $15 million in net revenue. Neurocrine expanded formulary coverage for INGREZZA in Medicare Part D, which allowed easy access for patients and led to higher turnout. The company holds a solid financial position with almost $1.8 billion in cash.

5. Align Technology, Inc. (NASDAQ:ALGN)

No. of Hedge Fund Holders: 58

Market Capitalization: $13.97 Billion

Analyst Upside: 28.72%

Align Technology, Inc. (NASDAQ:ALGN) is a global medical device company. It designs, manufactures, and sells the Invisalign system of clear aligners, iTero intraoral scanners, Vivera retainers, and services.

On May 1, Jason Bednar from Piper Sandler increased the price target on ALGN from $235 to $250, reiterating an Overweight rating on the shares. Bednar has raised the price target following increased confidence in its recent market performance and long-term prospects. The company’s growth in the Teen and Growing Kids segment and global expansion are two of the key catalysts for future growth. The Teen segment saw a 13.3% year-over-year growth in Invisalign Clear Aligner treatments.

Align Technology, Inc. (NASDAQ:ALGN) revenue and earnings for Q1 2025 surpassed the analyst estimates. The revenue came in at $979.26 million, beating estimates by $3.45 million. The adjusted EPS was around $2.13 per share, exceeding consensus estimates by $0.14. The strong financial results were driven by Clear Aligner volume increase, with notable growth in the Asia Pacific, EMEA regions, and North America. The company launched new products, including the Invisalign Palate Expander system and the iTero Lumina scanner with restorative software. These new product launches will potentially drive future growth.

4. Illumina, Inc. (NASDAQ:ILMN)

No. of Hedge Fund Holders: 61

Market Capitalization: $12.83 Billion

Analyst Upside: 23.18%

Illumina, Inc. (NASDAQ:ILMN) is a global healthcare firm engaged in providing sequencing and array-based solutions for genetic and genomic analysis. Illumina serves customers in various markets, allowing the adoption of genomic solutions in research and clinical settings.

Illumina, Inc. (NASDAQ:ILMN) had a promising development after the SEC dropped enforcement action on the company after concluding the investigation related to the acquisition of Grail in 2021. The company spun off Grail in 2024, following difficult times in which regulators had challenged the $8 billion takeover. This is a major development as the company can now fully focus on finding local partnerships to mitigate the Chinese ban, which has impacted Illumina’s sales by almost 7%.

On May 10, Daniel Arias from Stifel lowered the price target on ILMN from $160 to $135, maintaining a Buy rating on the shares. Arias pointed out the reduced full-year 2025 earnings guidance to be a key factor in lowering the price. Arias pointed out that the cut to the top line “was maybe a point or so deeper than we thought it might be, but the EPS outlook is better than the firm anticipated thanks to strong mitigation activities.” The management expects the EPS to be around $4.20 to $4.30, down from the previous guidance of $4.50 per share.

3. Tenet Healthcare Corporation (NYSE:THC)

No. of Hedge Fund Holders: 65

Market Capitalization: $14.68 Billion

Analyst Upside: 10.68%

Tenet Healthcare Corporation (NYSE:THC) is a diversified healthcare services company. Tenet’s segments include Hospital Operations and Services and Ambulatory Care. The Hospital Operations segment includes nearly 135 outpatient facilities, while the Ambulatory Care segment owns almost 518 ambulatory surgery centers and 25 surgical hospitals.

On April 30, A.J. Rice from UBS raised the price target on THC from $217 to $230, keeping a Buy rating on the shares. Rice highlighted a strong Q1 performance with earnings beat by 39.30% and adjusted EBITDA growth of 14% from a year ago. The company posted adjusted earnings of $4.36, exceeding estimates by $1.23 per share. The adjusted EBITDA margin improved by 320 basis points to 22.3% in Q1, reflecting robust growth and operating efficiency. Tenet Healthcare Corporation’s (NYSE:THC) UPSI-adjusted EBITDA soared over 16% from a year ago, with same-facility revenues soaring by 6.8%. Overall, the company made notable progress and is set to post strong results ahead.

2. Teva Pharmaceutical Industries Limited (NYSE:TEVA)

No. of Hedge Fund Holders: 72

Market Capitalization: $20.02 Billion

Analyst Upside: 31.62%

Teva Pharmaceutical Industries Limited (NYSE:TEVA) is a global pharmaceutical company that develops, manufactures, distributes, and markets generic and other medicines, and biopharmaceutical products. The company operates through three segments, including North America, Europe, and International Markets.

On May 12, JPMorgan increased its rating on TEVA from Neutral to Overweight and raised the price target from $21 to $23, highlighting Teva’s announcement of a $700 million cost-cutting initiative. According to JPMorgan, this latest initiative will significantly contribute to the company’s margin expansion goals for 2026 and 2027. This program is expected to improve Teva’s financial performance and reach a 30% operating margin target by 2027. This move will allow the company to overcome the challenges of low revenues from its drug gRevlimid and reinvest in the product pipeline.

Teva Pharmaceutical Industries Limited (NYSE:TEVA) posted mixed financial results in Q1 2025. The revenue came in at $3.89 billion, missing estimates by $97.39 million. The adjusted earnings were around $0.52, exceeding estimates by $0.06. The analysts expect the company to post revenue of around $4 billion in Q2, reflecting a 3% year-over-year growth, driven by AUSTEDO and biosimilars. However, tariffs and a drop in COPAXONE sales pose risks.

Sound Shore Management stated the following regarding Teva Pharmaceutical Industries Limited (NYSE:TEVA) in its Q4 2024 investor letter:

“Teva Pharmaceutical Industries Limited (NYSE:TEVA): Traditionally known as a generic drug company, Teva has a growing branded drug business and a promising pipeline. Following a period of poor capital allocation decisions by prior management teams, we were able to invest at a very attractive 4 times earnings and with a 20%+ free cash flow yield. New leadership has focused on execution and pipeline development, leading to upward inflection in margins and positive clinical trial results. Teva remains remarkably cheap, trading at a significant discount to its intrinsic value. (Please see our 2Q 2024 letter for a more in-depth review of Teva.)”

1. Insmed Incorporated (NASDAQ:INSM)

No. of Hedge Fund Holders: 72

Market Capitalization: $11.96 Billion

Analyst Upside: 49.30%

Insmed Incorporated (NASDAQ:INSM) is a global biopharmaceutical firm that is engaged in advancing a diverse portfolio of approved and mid- to late-stage investigational medicines and drug discovery. Insmed’s advanced programs are in pulmonary and inflammatory conditions. It is developing a protein, rhIGFBP-3, to improve chemotherapy effectiveness in breast cancer.

Insmed Incorporated (NASDAQ:INSM) posted a revenue of $92.82 million during Q1 2025, surpassing estimates by $1.58 million and up 23% year-over-year. The revenue was driven by strong demand for ARIKAYCE in Japan, Europe, and the U.S. Although the company missed earnings estimates, it is expected to improve its earnings in Q2 and lower its losses. Analysts expect INSM to post an EPS of -$1.30 per share, a notable improvement from -$1.42 in Q2 2024. A successful launch of ARIKAYCE will help the company improve its revenue in the future.

On May 9, Trung Huynh from UBS slightly lowered the price target of INSM from $110 to $109, keeping a Buy rating on the shares. The analyst remains positive on INSM as the company expects brensocatib, a therapy for chronic inflammatory lung diseases, to launch in the third quarter of 2025.

While we acknowledge the potential of INSM to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that has gone up since the beginning of 2025, while popular AI stocks have lost around 25%. If you are looking for an AI stock that is more promising than INSM but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks To Invest In According to Billionaires.

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