With their robustness and growth potential, healthcare stocks are becoming a focal point in portfolios worldwide. Moreover, the U.S. stands out at the forefront of healthcare spending, allocating a staggering $4.3 trillion annually. This accounts for 18.3% of its GDP, underscoring the sector’s major economic impact.
Additionally, healthcare profit pools are projected to surge from $654 billion in 2021 to a whopping $790 billion by 2026, growing at a 4% compound annual growth rate (CAGR). Complementing this growth, technology adoption among providers and payers is accelerating. It highlights a tech-driven shift in healthcare, with an expected 10% CAGR from 2021 to 2026.
This expanding sector is a reflection of an evolving demographic trend. With an aging population set to outnumber children by 2035, healthcare in the U.S. is a growing necessity. These shifts are making healthcare stocks a compelling choice for investors to buy now.
UnitedHealth Group (UNH)
UnitedHealth Group (NYSE:UNH) stands out as a resilient player in the healthcare stock market. Demonstrating a robust 5.20% rise in year-to-date return, the company’s recent earnings have surpassed expectations. In its latest quarter, UNH demonstrated impressive performance with a remarkable 14% increase in revenues to $92.4 billion, alongside a parallel 14% rise in operating earnings to $8.5 billion.
Additionally, UNH’s customer base has shown significant growth. Furthermore, the company has successfully added nearly 700,000 consumers to its commercial benefits services, while its senior and community care offerings have attracted over 400,000 new individuals. This expansion reflects the company’s strong and growing market presence.
Notably, UNH’s commitment to social responsibility and health equity shines through its $5 million investment in Enable Ventures. Announced at the SOCAP Conference, this initiative focuses on reducing the disability wealth gap. Moreover, this move, coupled with a strong buy rating and 8% upside potential from TipRanks analysts, makes UnitedHealth an attractive option for investors.
Boston Scientific Corporation (BSX)
Boston Scientific Corporation (NYSE:BSX), known for its innovative stent technology in heart surgery, has recently ventured into chronic pain management. The company’s strategic acquisition of Relievant Medsystems for $850 million brings the FDA-approved Intracept system for treating chronic low back pain into its diverse product lineup. This move secures support from major insurers, improving patient access.
Financially, BSX shows strong growth with net sales of a robust $3.52 billion, an 11.2% increase, and a revenue jump to an impressive $3.53 billion, up 11.26% year-over-year. Their net income soared to $504 million, a significant 168% rise from the previous year, highlighting the company’s staggering growth and operational efficiency.
Furthermore, BSX’s stock performance reflects its financial strength, with BSX shares climbing 20% year-to-date. TipRanks analysts endorse a strong buy rating, foreseeing a 9.74% upside potential for the stock. This optimistic outlook, combined with strategic growth, cements BSX as a key player in the healthcare sector.
Novartis (NVS)
Novartis (NYSE:NVS), a leading healthcare firm, is gaining investor interest due to its stellar performance. The company’s stock has seen an impressive 11% increase over the past year. Additionally, this uptick is partly driven by the success of Kisqali, their breakthrough breast cancer drug, which significantly reduces recurrence risk in hormone-driven breast cancer.
Moreover, Novartis’ commitment to advancing healthcare is evident as they plan to showcase data from over 100 trials at the 2023 San Antonio Breast Cancer Symposium and the American Society of Hematology Annual Meeting. This substantial presentation, highlighting their progress in breast cancer and hematology, reflects their vigorous research and development efforts.
Financially, Novartis posted a striking 12% sales increase and a notable 21% leap in core operating income. Revenues soared to $11.78 billion, outperforming by $410 million. These robust results and healthcare innovations earned Novartis a moderate buy rating from TipRanks, promising a 20.24% upside potential and marking them as a strong investment contender.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines
