Top AI Biotech Stocks Set To Explode 2026

Hey, welcome back subscribers to my world of stocks. My name is Ala of course and uh today we are going to be talking all about the some of the best um kind of stocks for targeting one of the biggest technological transformations happening right now in a multi- trillion dollar industry. And that is of course the integration of artificial intelligence across big pharma where for decades traditional drug discovery had been a painfully slow and ridiculously expensive process easily taking anywhere from 10 to 15 years just to push a single drug candidate from an initial idea into the laboratory all the way through clinical trials and eventually FDA approval while burning billions of dollars along the way. And yet still incredibly about 90% of all experimental drug candidates end up failing in clinical trials, never even making it to market. Now think about that for a second. This means that nine out of every 10 candidates crash into the ground, vaporizing billions of dollars in capital. Well, AI is very likely going to flip that formula completely on its head in the future as high-powered supercomputers and lightning fast machine learning models are already speeding up the entire process by screening millions of molecular combinations in just a few weeks instead of taking years where they're predicting the 3D shape of molecules, identifying exact disease targets, even simulating how they'll react inside human cells before anyone ever even touches it. So, in today's video, we're going to break down three distinct biotech stocks that are actively using AI themselves to revolutionize their entire businesses and drive their pipelines forward. And for some added variety, I specifically chose one relatively kind of safer heavyweight stock that is currently printing enormous cash flow. And then I chose kind of a best overall value and total package stock that also pays a very nice dividend, too. And finally, I picked a much riskier kind of moonshot play that was actually built from the ground up as an AI first kind of pure play in pharmaceuticals. So, let's go ahead and jump straight into it. Now, kicking things off here with the relatively safer pick first, we have the juggernaut biotech, Eli Liy, ticker symbol LLY, who's been making enormous strides in what we call peptidebased medicines. C peptides are short chains of amino acid that are inherently modular, meaning that they're almost like biological building blocks that AI can more effectively design and modify with extreme precision. It's almost like editing lines of computer code for it. Well, that exact underlying science is what actually powered the recent breakthroughs in GLP1 weight loss and diabetes treatments. They're generating, you know, tens of billions of dollars now across healthcare. um really throughout. And Eli Liy uh just happens to be one of the absolute leaders of course of this revolution primarily through their Mound Jarro and Zepbound treatments that together generated about $15 billion of revenue last quarter alone with Mount Jarro uh just itself growing a monstrous 91% year-over-year. Not to mention their new oral pill called Foundo that just barely released too and will likely be ramping up throughout the year. And what a lot of retail investors miss altogether is that Lily is actually using AI across the rest of their pipeline too and even forming strategic partnerships wherever necessary to maintain their lead. In fact, just earlier this year, they completed their brand new supercomput called Lily Pod, which is currently considered the most powerful biotech supercomputer in the entire world and is powered by over a thousand nextG Blackwell GPUs from Nvidia. Like I said, Lily is even forming numerous collaborations, too, like they already have with OpenAI for the discovery of novel antimicrobials. The $400 million deal with AI startup Genetic Leap to develop nextgen RNA targeted medicines. They just signed an even bigger $2.75 billion deal with an AI biotech called Encilico Medicine for an end-to-end generative AI engine that basically compresses like early stage drug discovery from taking, you know, several years to complete down to just a matter of months. And they're even using neural networks to screen billions of peptide structures to improve their entire process even further, too. Now, speaking of which, going back to weight loss for a second here. Well, these technologies are what's also helping them develop their nextgen experimental drugs like Raida True Tide, which is basically their upcoming triple threat weight loss peptide that targets three separate hunger hormones at the exact same time to drive even greater fat loss in clinical trials. And it's already seen like really promising results and there's a lot of hype behind it. And yet, not only is all of this AIdriven efficiency super promising for their future, but already the results are starting to show uh in their financial um statements, they're starting to see some traction there. For example, going back to that earnings report, their key drugs portfolio includes some of their newest treatments grew by triple digits yearover-year. That's when within um immunology, oncology, and neuroscience. In other words, Lily isn't just a play on the very hyped up trend of weight loss, although they are, you know, of course, perfect for that. Really, the probably the best play on it. But on top of it, they're also expanding in many other areas, too. And it's why analysts project both their sales and profits to skyrocket in the coming years. The results being that even though the stock is uh currently trading near record highs, a Lily's PEG ratio that factors in all that future growth, it's actually sitting around 15% lower than the sector median. That's pretty attractive for a company that is, you know, firing on all cylinders right now. And that still holds lots more future promise long term as AI pushes their business even further, especially for like, you know, AI peptides. um that that market really I think Lily is um I think they're really the gold standard for that to be honest. As for me though, um I like my pharma giants to uh pay a nice dividend if I can get one, which uh don't get me wrong, Lily has some excellent growth metrics on theirs, but at only around half a percent yield, it's just too small to really get me um very excited or or anyone else to to really notice. On the other hand though, stock number two on our list um actually carries a much cheaper valuation, a mouthwatering dividend yield, and in my opinion is just the overall kind of better package to invest in long term. And that's going to be in the uh big pharma giants Fizer, ticker symbol PF, who most investors have completely written off after the pandemic highs where the pepperoni provided so much growth for them that they almost instantly became the largest biotech in the entire world. But since then, once demand for those drugs plummeted, Fizer's financials corrected back down, causing the stock to crash by over half its entire value. Three things on that now. Number one, Fizer's stock price is now sitting even lower today than it did before the pandemic ever even happened. In fact, it's even lower than it was an entire decade ago. Yet, their financials are much higher than they ever were back then, which makes absolutely zero sense. Number two, they made so much money from the pandemic that they went on arguably the largest acquisition sprees in pharma history. Certainly the biggest that I've ever seen, spending around $80 billion in total. And number three, even if we put all of this aside, oh, back to the topic of this video, Fizer is diversifying well away from just pandemic era drugs. And a huge part of that is really being driven now by AI. For example, they partnered with AWS to build what is known as the Fizer Scientific Data Cloud or SDC that basically compiles decades of historical molecule data, allowing their AI algorithms to instantly search and analyze all of it to design better drugs much faster than ever before across the entire pipeline. On top of that, they just signed a big licensing deal to use a specialized biologics AI platform called Chi3, which they're now using to design brand new antibodies completely from scratch, predict molecule uh interactions much faster than ever before, too. And they're even using machine learning to instantly match patients to clinical trials and optimize their regulatory submissions which all perfectly ties into their giant $43 billion acquisition of CGEN where Fiser is now combining this you know AI molecular design with antibbody drug conjugates what are known as ADCs. These are basically guided kind of target missile therapies for cancer that can deliver chemotherapy directly to the the uh the tumor cells while avoiding healthy tissue. That could be a real gamecher for for one of the biggest diseases of course tragically in the world. And when you look at their latest earnings report, well, you can actually see the early signs of this turnaround kind of gaining traction for them as their newly launched and acquired product sales actually soared by a huge 18% year-over-year. While just acquired products alone skyrocketed by even more, a bigger uh 25% growth. Now, guys, this right here is exactly what I've been telling you that I kind of predicted would happen. I've been saying this for the past few years that as the stock was crashing into the ground, I warned you that this company already made all the profit that they were they would ever need from the pandemic years. You know, regardless of of of what you know, our personal opinions or feelings are about the whole pandemic and and and the medications for it and all that kind of stuff. The the fact is just looking at this from an investment perspective alone, Fizer made unbelievable amounts of money from that. And so they already collected it and then they used it to acquire all of these new companies that are slowly going to be making up for the falling sales coming off the pandemic and a and eventually it's going to overtake that. In fact, most people don't even know this, but Fizer has actually exceeded expectations on both the top and bottom line for almost every single quarter of the past 2 and 1/2 years already. And yet because of all the the the fear from investors, you know, coming off the pandemic, the the the crashing demand for for their um drugs and treatments, the stock is now insanely cheap. I mean, it's trading even lower than the sector by over 50% on a forward PE basis. And the dividend has skyrocketed to one of its highest yields ever at above 6%. Which, you know, most of the time investors would be more than happy to just collect around half that amount. And it's also a pretty safe dividend, too, by the way. Um cuz Fiser has actually been implementing tons of cost cutting initiatives and this results in a pretty good payout ratio for them of less than 60%. With now over a decade and a half of consecutive growth on that dividend. That's why I've been buying the stock myself and to this day I still think that it's probably one of the most slept on plays in the market for the long term. Again, just from an investment perspective alone, I know it's a controversial stock, but just from investing, like if you're putting your money somewhere, you know, hoping to get a return on it, I think Fizer, I don't know. To me, it's always looked like a like a pretty good deal coming off the pandemic off that giant crash. All right, guys. Um, it's time to wrap up the list, though, with um stock number three now, which is actually going to be our riskiest option of the three. Um, and it's kind of a moonshot play, uh, the moonshot option of the bunch, and that is Recursion Pharmaceuticals, ticker symbol RXRX, who unlike Lily or Fizer, uh, Recursion is not a traditional big pharma giant with dozens of, you know, commercialized drugs already generating tens of billions in cash or some monumental pipeline in the triple digits, but rather this is an AI first biotech that was literally built from the ground up to replace manual wet lab biology with AIdriven machine learning. For example, they run these automated robotics labs that perform millions of microscopic experiments every single week, generating pabytes of proprietary biologics data. And that super valuable data, by the way, is then fed into their massive supercomput called BioHive 2, which was originally the most considered the most powerful supercomputer in biotech, using hundreds of high-end Nvidia GPUs. We're using that to build foundational models that can map out human disease networks and predict how compounds interact with disease cells. Well, this platform has already attracted some of the biggest names in the industry where they now hold multi-year contracts with giants like Ro Bear, Sanifi, um Brislers, Squib, Merc, and more. And they're even deeply partnered with tech powerhouses like Nvidia, Google, and Tempest as well. And even inhouse, this AI platform holds a lot of promise for them, too. Their lead oncology program for example RAC7735 was designed and optimized in just 10 months by screening only 242 compounds which completely crushes the traditional biotech timeline of anywhere from like 3 to 5 years and having to you know go through thousands of compounds by comparison. But like I said this is still the riskiest option of the three and it's not even close. uh mainly because of all of their um collaboration milestone payouts that can and very likely will be highly volatile and unpredictable with even their own in-house developments always being at risk of failure too. Now the result is that we really have unreliable sales here at times with much bigger losses on the bottom line. And while analyst projections do at least predict a strong rebound in the in the stock price, um that stock has so far been a devastatingly terrible performer ever since they IPOed falling around 90% all time. Now thankfully I purchased a very tiny amount well after that gigantic crash. So I feel totally fine, you know, holding this as a very small spec play for the future. And I do think that it does have a lot of tremendous potential if they ever manage to release a commercial hit into the market. I think this could be a high-f flyier, but until then, it remains a high-risk but potentially highreward kind of moonshot type of play. All right, guys, that's going to do it though for this video. Let me know what you all think about these down below. And as always, remember to do your own research and make your own decisions. But do you own any of these stocks, or are there other biotechs that you actually like more in the market? Can you please tell me what those are down below and why? because I'd love to do another deep dive video for you guys on some of your favorite stocks, too. But for now, I hope that you're all doing well. I thank you so much for stopping by and and uh for all of your support. And I got more videos coming for you soon. So stay tuned. Catch you guys in the next one. All right, take care, my friends. Bye-bye. [music]