Biotech is a notoriously risky business. Many biotechnology products do not produce the desired results consistently, while others fail to gain acceptance in the marketplace. Of course, when a biotech product succeeds, investors can make a lot of money.

You can stay off the roller coaster by looking for companies that have a stable track record, with growth prospects that are reasonable rather than dramatic. Despite the drama that is built into the biotech business, there are companies that proceed calmly and offer investors reliable returns. (To learn more, check out: A Primer on the Biotech Sector.)

We have selected five top biotech stocks that are poised for growth in 2018. All figures are current as of May 3, 2018.

Celgene Corporation (CELG)

Celgene focuses on cancer and inflammatory diseases. The company not only develops its own products – it collaborates with other large drug makers to bring products to market. Revenues have grown in recent quarters, and operating income has increased steadily. Celgene has been a stable company, especially considering that the biotech sector carries high risk.

The stock started 2017 with steady gains through April but then gave back those gains. At the beginning of June, the stock found support and began rising again. However, Celgene shares declined sharply in October 2017, falling more than 30% over the course of the month as the company canceled studies of a Crohn's disease treatment and reported worse-than-expected third quarter results. The stock has continued to tick downward in the first four months of 2018, but given Celgene's solid long-term track record, the recent declines may represent a buying opportunity. (See also: Biotech Celgene May Rise 35% in 2018.)

Gilead Sciences, Inc. (GILD)

Gilead has been growing at a rate of around 30% for five years. The company is a leader in HIV treatments and has a successful drug for treating hepatitis C. Revenues have been rising, and operating income is up for the past four years.

A look at the stock chart shows that Gilead entered a declining price channel starting around May 2016. The shares put in a bottom at around $64, then broke sharply upward in late June 2017. The stock had additional high-volume breakouts at the beginning of September 2017 and then again to start the new year, reaching a 52-week high of nearly $90 toward the end of January 2018. Gilead shares then ticked downward in early February along with the broader markets, and the stock saw additional sharp declines after posting lackluster first quarter results in April, reaching current levels of $65.26. Although there is some uncertainty surrounding several of the company's products and concerns about declining revenues from hepatitis C treatments, one potential catalyst is a new "shock and kill" HIV treatment combination in the early phases of development. (For more, see: Biotech Stocks May See a New M&A Wave in 2018.)

  • Average Volume: 7,647,983
  • Market Cap: $85.089 billion
  • P/E Ratio (TTM): 18.59
  • EPS (TTM): $3.51
  • Dividend and Yield: $2.28 (3.09%)

Exelixis, Inc. (EXEL​)

Exelixis focuses on cancer care. It has anti-tumor drugs as well as treatments for kidney cancer. The company has routinely delivered positive surprises on earnings.

The stock had a breakout to start 2017 and then began forming a base. It remained in that consolidation phase through the first half of the year. Exelixis stock broke sharply upward out of the base in late June 2017, and after seeing some volatility during the later part of the year, it moved up strongly once again in December. The stock continued to see some ups and downs to start 2018 before declining sharply in late February on a lackluster response to fourth quarter earnings, reaching current levels of $21.47. Exelixis entered a licensing deal with Takeda Pharmaceutical (TKPYY) last year that pleased investors. (See also: Exelixis, Takeda Ink $145M Cancer License Pact.)

  • Average Volume: 3,074,404
  • Market Cap: $6.369 billion
  • P/E Ratio (TTM): 43.55
  • EPS (TTM): $0.49
  • Dividend and Yield: N/A (N/A)

Enzo Biochem, Inc. (ENZ)

Enzo offers therapies for cancer, diabetes, cardiovascular disease and infectious diseases. The stock entered an uptrend in March 2016 and started forming a new base in December 2016. Enzo shares broke out in early March 2017 and then saw a second breakout on June 11, 2017. The stock is now in a new base that began forming in late June. With a market cap of approximately $285 million, Enzo represents the smallest company on our list, which could suggest even more volatility in a sector that is already known for its ups and downs.

  • Average Volume: 188,813
  • Market Cap: $284.825 million
  • P/E Ratio (TTM): N/A
  • EPS (TTM): -$0.03
  • Dividend and Yield: N/A (N/A)

AbbVie Inc. (ABBV​)

AbbVie is the maker of Humira, which treats autoimmune issues. The company also has products to treat leukemia and hepatitis C, as well as other treatments that suppress HIV. In addition, AbbVie is involved in testosterone-replacement treatments and has drugs for multiple sclerosis. AbbVie shares surged in September 2017, and at the end of that month, the company settled a dispute with Amgen Inc. (AMGN), successfully delaying the competitor's launch of a biosimilar version of Humira. AbbVie shares soared to an all-time intraday high over $125 on Jan. 26, 2018, but have fallen since then to current levels just below $100. (For more, see: How AbbVie Makes Its Money.)

  • Average Volume: 7,371,108
  • Market Cap: $158.256 billion
  • P/E Ratio (TTM): 30.22
  • EPS (TTM): $3.30
  • Dividend and Yield: $3.84 (3.98%)

The Bottom Line

Investing is not gambling. Although the biotech sector carries risk, it is still possible to find solid companies with reasonable prospects for growth. All of the companies on this list have weathered the ups and downs of the industry, and they look like they are ready to come out on top in 2018. (For additional reading, check out: Risks and Rewards of Biotech Companies.)

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