Regeneron Stock: A Look into My Investing Process


Until now, I’ve used this blog primarily to share thoughts on market trends and macroeconomic developments. While it is important to understand current market conditions and have a general sense of macroeconomics, I generally find little interest in covering these topics. I am, at heart, a bottom-up investor. In other words, a bulk of what I do is analyze individual companies and invest through that perspective, rather than through a macroeconomic perspective.

Today, I’m offering a first look into how I evaluate a company for potential investment. As always, this is not financial advice. I’m not recommending that you buy any stock. Instead, consider this case study a window into my investment process.

Why Regeneron?

Regeneron is a stock I’m currently watching closely. I already hold a position in my personal portfolio, and I may increase it significantly. That said, it’s currently one of my losing positions—down about 20%. Still, I believe the future could be bright.

The stock is down more than 50% from its all-time highs, which is often the first thing that catches my attention. I love a good turnaround story. Of course, a falling stock price alone isn’t a reason to buy—some might even argue it’s a red flag. But I see opportunity in beaten-down names, especially when the fundamentals remain strong.

Fundamentals First

The first thing I look at when analyzing stocks is deceptively simple: is the company making money? In Regeneron’s case, they’re practically printing it. Over the trailing twelve months, the company generated more than $14 billion in revenue with a 31% profit margin. If you don’t know, that’s excellent.

Next, I examine cash reserves and debt levels. Again, Regeneron shines. The company holds over $8 billion in cash and carries virtually no debt. Its current ratio is 4.93, meaning it has nearly five times more current assets than current liabilities. These are stellar numbers, indicating a rock-solid financial foundation.

But if investing were as easy as analyzing current fundamentals, everyone would be good at it. The real challenge lies in understanding sentiment and anticipating future developments.

The Challenges

Investor sentiment around Regeneron has soured recently. One of its flagship drugs, Eylea, is facing slowing growth due to increased competition—a natural part of the drug lifecycle. On top of that, a disappointing Phase III trial report for another key drug, Dupixent, has further dampened enthusiasm.

As a result, the stock has largely fallen off the radar. But I believe that’s a mistake.

The Opportunity

Regeneron has a robust drug pipeline and some of the best financials in the industry to support future growth. The company also recently acquired 23andMe at a discount. While I have mixed feelings about the ethical implications of this acquisition, it signals Regeneron’s commitment to expanding its drug development capabilities. The genetic data from 23andMe could prove invaluable in both R&D and targeted marketing.

What excites me most, however, is Regeneron’s potential entry into the weight loss treatment space. A promising Phase II trial showed that Trevogrumab—a drug in their pipeline—can help preserve lean muscle mass when used alongside semaglutide (the active ingredient in blockbuster drugs like Ozempic). If you follow the medical industry at all, the blockbuster development of the last year or two has been weight loss treatments. However, one of the major drawbacks of GLP-1 treatments like semaglutide is muscle loss. If Trevogrumab can mitigate that, it could be a game-changer in weight loss treatment and prove very beneficial to Regeneron’s stock price.

Final Thoughts

Of course, nothing is guaranteed. Eylea and Dupixent could continue to struggle, and the weight loss pipeline might not pan out. But with a price-to-earnings ratio around 13 and outstanding fundamentals, I’m comfortable making a calculated bet on Regeneron.

Stock picking isn’t a science—if it were, it would be easy. It’s an art. You have to make calculated bets. Due the research I’ve outlined above, I’m making a calculated bet that Regeneron will experience increased investor sentiment in the future and return to solid growth.

I hope this case study gives you some insight into how I approach stock selection. Again, this is not a recommendation to buy Regeneron, but rather an example of how I think through an investment thesis. Hopefully, I’ll be back in the future with an update—and a gain to report. Although I do not provide financial advice, I am always willing to talk stocks. Feel free to email me at epstock10@gmail.com

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