Earlier this week, Moody's revised its bearish outlook for Big Pharma, upgrading the industry's status to "stable." For some time now, the major overhang has been the patent cliff, but Moody's appears to have recognized that this is less of a threat than previously thought -- hence the overall outlook increase from negative to neutral.
Of course, a variety of different outlooks exist across companies, with Merckand Pfizerperforming relatively well even as their blockbuster drugs have come off patent (Singulair and Lipitor, respectively). Weaker links in the sector include AstraZeneca and Bristol Myers, both of which continue to see significant declines in earnings because of patent expirations.
What's Fool.com analyst Brenton Flynn's takeaway here? In the following video, he notes that while the sector's looking OK overall, investors would definitely be wise to look at individual companies closely before making a pick in this space. Click play to watch and learn more.
While you can make huge gains in biotech and pharmaceuticals, the best investing approach is to choose great companies and stick with them for the long term. In our free report "3 Stocks That Will Help You Retire Rich," we name stocks that could help you build long-term wealth and retire well, and also reveal some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.
The article Big Pharma Gets Another Fan originally appeared on Fool.com.
Brenton Flynn and Dave Williamson have no positions in the stocks mentioned above. The Motley Fool owns shares of AstraZeneca. Motley Fool newsletter services recommend Moody's. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.