2 Underrated Weight Loss Stocks to Buy and Hold

Regeneron reported Q1 revenue of $3.6 billion, up 19% year over year, while Amgen posted Q1 revenue of $8.6 billion, up 6%, as both companies advance promising obesity pipelines. Regeneron is preparing phase 3 trials for olatorepatide, which showed up to 19% weight loss in a 48-week China study, while Amgen's MariTide is in phase 3 across multiple indications and may offer once-monthly dosing. Amgen also highlighted a 3% forward dividend yield and continued dividend growth, supporting the long-term bull case.

Analysis

The market is still treating obesity as a winner-take-all category, but the more important setup here is platform optionality: both REGN and AMGN already have cash-generative core franchises that can finance long-duration pipeline shots without needing the weight-loss program to work immediately. That matters because the first company to prove durable differentiation on dosing frequency, tolerability, or lean-mass preservation could command a far richer reimbursement and adherence profile than a simple efficacy race would imply.

Second-order, the biggest beneficiaries may be the adjacent winners in diagnosis, monitoring, and procedure substitution rather than the obvious GLP-1 leaders. If monthly or less-frequent dosing proves real, pharmacy channel frictions drop and persistence should improve, which can expand the addressable market by converting discontinuers rather than only stealing share from incumbents. That would pressure NVO and Eli Lilly at the margin, but more so by slowing mix expansion than by causing a sudden share collapse.

The key risk is timing asymmetry: both names can re-rate on pipeline headlines over months, while true commercial proof is years away. Any phase 3 stumble, safety signal, or inability to reproduce ex-U.S. data in U.S.-registered studies would likely compress enthusiasm quickly, and obesity assets with novel dosing are especially vulnerable to disappointment on real-world adherence and GI side effects. In that sense, the current move is probably underdone for long-only investors who want embedded growth plus optionality, but overdone if one is underwriting near-term obesity revenue.

Contrarian view: consensus is still framing these as "also-ran" obesity names, when the better edge may be that the obesity programs are free calls on top of already-healthy earnings trajectories. For AMGN, dividend support lowers downside and makes the stock a cleaner way to own pipeline upside with less financing risk; for REGN, the multiple can expand if investors stop discounting the durability of its core immunology/retina cash flows. The real debate is not whether they can compete in obesity, but whether the street is underestimating how much incremental multiple support a credible obesity franchise adds to already-strong fundamentals.

Key Decisions for Investors

• Initiate a long REGN position on pullbacks over the next 4-8 weeks; use the core franchise as downside support and treat obesity as a free option. Risk/reward skews to 2:1 if the market starts assigning even modest probability to successful U.S. phase 3 execution.
• Buy AMGN versus NVO as a relative-value pair for the next 3-6 months. AMGN has cleaner balance-sheet-backed optionality and dividend support, while NVO is more exposed to an ownership narrative already crowded into the leader name; target a 5-8% spread move if MariTide data stays constructive.
• Express obesity upside with limited downside via REGN or AMGN call spreads 6-12 months out, rather than outright stock. This captures clinical catalyst convexity while limiting damage if trial timelines slip or data are merely good, not category-leading.
• Avoid shorting NVO aggressively on this article alone; use it only as a hedge against a long basket of obesity beneficiaries. The better trade is to own the challengers where valuation embeds less perfection and catalyst optionality is less fully priced.
• For income portfolios, overweight AMGN on any weakness over the next quarter. The yield cushions delay risk, making it a superior carry vehicle while waiting for obesity and pipeline catalysts to mature.