To The Moon

Although high-valuation stocks in the current U.S. stock market continue to rise, and value stocks have lagged far behind growth stocks in recent years, stock valuations are still crucial for investors.

Specifically in the medical sector, although the performance of U.S. medical stocks in the past two years has not been outstanding, the valuation is also lower than the $.SPX(.SPX)$ index. As market expectations for the medical sector improve, the industry will also regain the favor of value investors.

Looking ahead to the next five years, the following two U.S. medical value stocks are expected to shine.

U.S. medical value stocks 1: $Moderna, Inc.(MRNA)$

Moderna has become a household name for developing and promoting vaccines during the COVID-19 pandemic. The company was able to launch the COVID-19 vaccine at an astonishing speed, mainly due to its cutting-edge work in the development of messenger RNA (mRNA) vaccines and therapies.

Moderna's COVID-19 vaccine sales have fallen sharply in the past few years, but this has also brought a positive "side effect": Moderna's stock valuation can be said to have become very attractive.

The company's enterprise value is about $10.7 billion, which is about 3.6 times its expected sales in 2025, and the forward price-to-earnings ratio (PE) is about 7 times.

The decline in sales of the new crown vaccine has bottomed out, and Moderna now has another growth opportunity. The company's second approved product, the respiratory syncytial virus vaccine (RSV) mResvia, has great potential, with annual peak sales expected to reach $1.5 billion. In addition, the market seems to underestimate the potential of Moderna's product pipeline, and the company expects to have 10 products approved by 2027. If this goal is achieved, the company's sales will increase significantly by 2030.

US medical value stock 2: $Pfizer(PFE)$

Pfizer is the only pharmaceutical company in the United States that has launched a new crown vaccine faster than Moderna. As a large pharmaceutical company, Pfizer also sells a variety of other products, including drugs for autoimmune diseases, cancer and migraines.

Like Moderna, Pfizer's COVID-19 vaccine sales have also fallen significantly, and the company will face the problem of losing patent protection for several blockbuster drugs in the next few years. As a result, the stock currently has a forward price-to-earnings ratio of less than 9 times.

However, Pfizer's growth prospects may be more optimistic than many people think. Pfizer has invested heavily in internal research and development and acquisitions in recent years. These efforts have added a number of "star" products to Pfizer's product portfolio, including RSV vaccine Abrysvo, migraine treatment drug Nurtec ODT, and anti-cancer drugs Adcetris and Padcev. In addition, Pfizer's dividend yield is as high as 6.4%, providing investors with a solid investment return foundation.

Summary: For long-term investors, whether it is Moderna or Pfizer, these companies are expected to become outstanding investment targets in the next few years with their R&D advantages and long-term product pipeline planning.