3 Monster Stocks in the Making to Buy Right Now

California’s giant redwood trees were once tiny sprouts or seeds. Likewise, the world’s biggest companies were once much smaller. Trees and companies can grow significantly over time — at least some of them.

Three Motley Fool contributors think they’ve found biotech stocks that have the potential to become much larger. Here’s why they think CRISPR Therapeutics (NASDAQ: CRSP), Zealand Pharma (OTC: ZLDP.F), and Viking Therapeutics (NASDAQ: VKTX) are monster stocks in the making to buy right now.

CRISPR Therapeutics: The gears are in motion

Prosper Junior Bakiny (CRISPR Therapeutics): It’s always an important milestone for a clinical-stage biotech to launch its first product. That’s what happened with CRISPR Therapeutics last year. The gene-editing specialist earned approval for Casgevy, developed in collaboration with Vertex Pharmaceuticals, to treat sickle cell disease (SCD) and transfusion-dependent beta-thalassemia (TDT).

However, CRISPR Therapeutics’ breakthrough was significant for several other reasons. Let’s name two. First, there is a large unmet need in SCD and TDT, a need Casgevy will help fill where it is approved. Second, Casgevy became the first approved gene-editing treatment that uses the CRISPR-Cas9 gene-editing technique that earned its creators a Nobel Prize in chemistry.

Here’s why that matters. CRISPR Therapeutics uses this technique across its entire platform of investigational medicines. Until Casgevy, it had not yet proved that its technology could get medicines through all the necessary clinical and regulatory obstacles on the way to approval. With this win in the bag, CRISPR Therapeutics can confidently move forward. The company has many other exciting pipeline candidates. In the next five years, expect important progress from the company’s programs while it racks up solid and consistent revenue from Casgevy.

In short, CRISPR Therapeutics has many of the qualities necessary to succeed as a biotech company: a strategic focus on challenging targets, proven innovative abilities, and a rich pipeline. Though its market cap is hovering around $5 billion as of this writing, the stock is likely to become a much more prominent player.

A Danish biotech with two potential growth catalysts

David Jagielski (Zealand Pharma): The big monster growth stocks in healthcare these days are involved with weight loss treatments. One stock that may not get as much attention as other big-name players is Zealand Pharma. The Danish company is not nearly as popular as Novo Nordisk, but investors shouldn’t overlook its potential in becoming a huge growth stock.

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What’s promising about Zealand Pharma is that it has not one but two weight loss drugs that could be game changers for its business. Survodutide has demonstrated positive results in treating a form of liver inflammation known as metabolic-associated steatohepatitis (MASH) in phase 2 trials. And it has also shown that it can help people lose around 19% of their body weight after 46 weeks. Another drug, petrelintide, helped trial participants lose up to 8.6% of their body weight after using it for 16 weeks in an early-stage study.

Zealand isn’t a profitable company. However, if it can get one or more weight loss products across the finish line, the business should have plenty of growth opportunities. That will pave the way for not just a path to profitability in the future, but to a much higher valuation as well.

The stock has already been a hot buy this year, soaring by more than 140% in the hopes that it can be a big player in the lucrative anti-obesity market. And if it is, there could be a ton of upside potential for the healthcare stock.

Same song, different verse

Keith Speights (Viking Therapeutics): David and I are singing the same song but with a different verse with our stock recommendations. I agree with him about the tremendous market opportunities in MASH and obesity. But instead of Zealand Pharma, I think growth-oriented investors should check out Viking Therapeutics.

Viking’s pipeline features two promising phase 2 candidates. The company is evaluating VK2735 in treating obesity and VK2809 in treating nonalcoholic steatohepatitis (NASH), which is also known as MASH. There have been positive results from both programs already.

In February 2024, Viking announced that patients receiving an injectable form of VK2735 achieved nearly 15% weight loss after 13 weeks of treatment (up to 13.1% on a placebo-adjusted basis). This result was better than weight loss for a 2.4 mg dose of Novo Nordisk’s semaglutide (marketed as Ozempic and Wegovy) after 20 weeks of treatment.

Less than four months later, Viking reported good news for VK2809. The experimental drug helped up to 75% of patients achieve MASH/NASH resolution with no worsening of fibrosis compared to 29% for patients receiving placebo. Viking announced in 2023 that VK2809 had met the primary endpoint of its phase 2 study in significantly reducing liver fat content through 12 weeks of treatment.

Analysts project that both VK2735 and VK2809 could be blockbuster drugs if approved. Viking also has two programs in phase 1 testing — an oral version of VK2735 that should soon advance to phase 2, and VK0214, which targets the rare genetic disorder X-linked adrenoleukodystrophy (X-ALD).

Viking’s market cap right now is only $5.5 billion. If its pipeline candidates fulfill their potential, this small biotech stock will be a monster in the next decade.

Should you invest $1,000 in CRISPR Therapeutics right now?

Before you buy stock in CRISPR Therapeutics, consider this:

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David Jagielski has no position in any of the stocks mentioned. Keith Speights has positions in Vertex Pharmaceuticals. Prosper Junior Bakiny has positions in Vertex Pharmaceuticals. The Motley Fool has positions in and recommends CRISPR Therapeutics and Vertex Pharmaceuticals. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.

3 Monster Stocks in the Making to Buy Right Now was originally published by The Motley Fool