One thing you can always count on do-nothing politicians to employ is hot populist rhetoric on subjects that they won’t do anything about, but that they know strikes a chord with voters. One of the hottest of hot-button issues is drug pricing, and every four years like clockwork it emerges as the contenders beat up on the big, evil pharmaceutical companies.

Needless to say, some drugs are expensive, and generic and biosimilar versions are helping to lower prices across the spectrum. The relentless attacks also have lowered the prices on some of the top companies, and long-term growth and income investors have a chance to buy some great stocks on sale. We screened our Wall Street research database, and found four that are very inexpensive now that are rated Buy.

AbbVie

This is one of the top global pharmaceutical stocks picks across Wall Street. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. The company’s mission is to use its expertise, dedicated people and unique approach to innovation to develop and market advanced therapies that address some of the world’s most complex and serious diseases. AbbVie employs more than 26,000 people worldwide and markets medicines in more than 170 countries.

One of the biggest concerns with AbbVie is what eventually might happen with anti-inflammatory therapy Humira, which generated $14 billion in sales in fiscal 2015. That was the most any drug has recorded during a single year and represents a gigantic part of the company’s overall earnings. The problem is that biosimilars and generics are itching to enter the market with Amgen leading the charge, and some Wall Street analysts project that AbbVie may have a difficult time stopping that trend.

Back in May, the patent board instituted Coherus BioSciences’ Inter Partes Review against the Humira ‘135 patent. The outcome of the review is expected next year. While most analysts remain positive on Humira duration, the fact that Abbvie’s exclusivity on the drug may only last another four to six months has hammered the price. Recent so-so earnings and 2017 guidance didn’t help either.

AbbVie investors receive a 4.09% dividend. The Jefferies price target for the stock is $90, and the Wall Street consensus target is $70.63. Shares closed Monday at $55.78.

Abbott Laboratories

Shares of this top pharmaceutical stock with very solid growth potential are down over 15% from highs hit last summer. Abbott Laboratories (NYSE: ABT) is a leading diversified global health care company that develops, manufactures and markets branded generics, medical devices, nutritional products and diagnostic solutions.

The company recently agreed to acquire the equity in Minnesota-based Tendyne Holdings that it does not already own for $250 million plus future payments tied to regulatory milestones. Wall Street likes the purchase and the way the company is putting its substantial balance sheet to work.

The company also offers a diversified large cap play as earnings are split between five well-positioned business segments: Nutritionals (31% of revenues), Vascular (13%), Generic Pharmaceuticals (20%) and Diagnostics (25.5%) and Diabetes (10.5%).

Back in July, CEO Miles White, who has been at the firm for over three decades, bought a stunning $45.5 million worth of company stock, which added to his already substantial holdings. The purchase made him one of the top 100 shareholders.

Abbott Labs investors receive a 2.65% dividend. Deutsche Bank has a $49 price target. The consensus target is $47.50. Shares closed Monday at $39.24.
Eli Lilly

This is another stock with substantial upside potential, and it is on Merrill Lynch’s US 1 list. Eli Lilly and Co. (NYSE: LLY) is a global health care company with numerous core products in a number of primary-care pharmaceutical markets. The company generates revenues from its pharmaceutical product and animal health segments.

The product portfolio includes Zyprexa (for schizophrenia and bipolar disorder), Gemzar (pancreatic cancer), Evista (osteoporosis), Cymbalta (depression), Cialis (erectile dysfunction), Strattera (attention deficit hyperactivity disorder), Erbitux (cancer) and Alimta (chemotherapy). Eli Lilly also has a strong presence in the diabetes market.

The company posted third-quarter sales and earnings well below Wall Street’s expectations, prompting shares to plummet to a four-month low before rebounding. The stock is down almost 10% on the year and offering investors an outstanding entry point. Top analysts on Wall Street are still very focused on the company’s outstanding late-stage product pipeline, which they and others on Wall Street view as very undervalued.

Shareholders are paid a 2.76% dividend. The $105 Merrill Lynch price objective compares with the consensus price target of $96.60. Shares closed Monday at $73.84.

Merck

This leading health care stock is on the focus lists of many of the firms we cover. Merck & Co. Inc. (NYSE: MRK) offers therapeutic and preventive agents to treat cardiovascular issues, type 2 diabetes, asthma, nasal allergy symptoms, allergic rhinitis, chronic hepatitis C virus, HIV-1 infection, fungal infections, intra-abdominal infections, hypertension, arthritis and pain, inflammatory, osteoporosis, male pattern hair loss and fertility diseases.

The company also provides neuromuscular blocking agents for use in surgery, anti-bacterial products for skin and skin structure infections, cholesterol modifying medicines, non-sedating antihistamine and vaginal contraceptive products. Other products to prevent chemotherapy-induced and post-operative nausea and vomiting, treat brain tumors, treat melanoma and metastatic non-small-cell lung cancer and prevent diseases caused by human papillomavirus, as well as vaccines for measles, mumps, rubella, varicella, chickenpox, shingles, rotavirus gastroenteritis and pneumococcal diseases.

Further, it provides antibiotic and anti-inflammatory drugs to treat infectious and respiratory diseases, fertility disorders, and pneumonia in cattle, horses and swine; vaccines for poultry; parasiticide for sea lice in salmon; and antibiotics for the treatment of C. difficile, and vaccines against bacterial and viral disease in fish.

Merrill Lynch noted this after earnings were reported:

Merck reported third quarter 2016 earnings-per-share of $1.07, above our $0.98 estimate (consensus was at $0.99), driven by a solid topline and judicious cost control. Merck’s anticipated dominance of first line lung cancer and attractive event path were the central tenets of our recent upgrade.

Merck shareholders receive a 3.13% dividend. The Merrill Lynch price target is $71, while the consensus target is $66.11. Shares closed most recently at $58.72.

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There are opportunities in these outstanding companies, and regardless of who wins the White House, the U.S. House should remain in Republican hands so intense government drug pricing actions should be much less of a threat.

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