Investment theme: Healthcare and Related Services
On average, the healthcare sector is once again offering growth at a reasonable price. The sector should trade at an attractive valuation while the growth story begins anew.
Favorites:
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Essilor | ESSI | Healthcare equipment | 20 % | 5.89 |
| Investment case: The company has engaged well in a solid growth strategy through acquisitions. It is also pursuing a business transformation with a focus on online services and converting website visitors into sales. Furthermore, it has a strong and innovative product line, which will further help sales growth. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Thermo Fischer | TMO | Life Sciences | 19.1 % | 6.83 |
| Investment case: TMO’s sales now exceed the benchmark of USD 12 billion per year. It is therefore the largest and most diversified provider of life sciences tools. Thermo shares now figure in Aaron Cowen’s Suvretta Capital Management portfolio. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| McKesson | MCK | Healthcare Technology | 20.5 % | 5.90 |
| Investment case: MCK is well positioned to benefit from the secular growth trend in the generic drug pipeline market. With one-time items discounted, recent results are incredibly strong. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Mylan | MYL | Pharma | 22.4 % | 4.55 |
| Investment case: MYL performed well recently. Additionally, it won a USD 100 million lawsuit against GSK. The company could become a takeover target. | ||||
| Company | Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) |
| Tenet Health Care | THC | Healthcare provider | 13.4 % | 3.29 |
| Investment case: THC operates 49 hospitals with over 13,500 beds. Volatiliy in the stock price offers a good buying opportunity as macro factors improve. Tenet is a “buy” from Mizuho, which says the hospital sector will benefit from individual mandate exemption rules. | ||||
| Ticker | Sub-Sector | Upside Potential | Sharpe (FY01) | |
| Mylan | MYL | Pharma | 22.4 % | 4.55 |
| Investment case: MYL performed well recently. Additionally, it won a USD 100 million lawsuit against GSK. The company could become a takeover target. | ||||