BIO, QDEL, and MRNA are top for value, growth, and momentum, respectively
Healthcare, one of the largest and most complex sectors, is comprised of a broad range of companies that sell medical products and services. The healthcare sector includes companies that sell drugs, medical devices, and insurance, as well as hospitals and healthcare providers. Some of the largest healthcare companies in the world include UnitedHealth Group Inc. (UNH), Pfizer Inc. (PFE), and Abbvie Inc. (ABBV). The healthcare sector has caught investors’ attention since some of these companies have received regulatory approval for drugs to treat COVID-19 and begun distributing vaccines, and others are rushing to develop and win approval for new COVID-19 drugs. There are also companies involved in various ways, such as supplying products to test for and manage treatments of the virus.
Healthcare stocks, represented by the Health Care Select Sector SPDR ETF (XLV), have underperformed the broader market. XLV’s total return was 23.9% over the past 12 months, below the Russell 1000’s total return of 52.8%, as of April 21. The statistics in the tables below are also as of April 21.
Here are the top 3 healthcare stocks with the best value, the fastest growth, and the most momentum.
These are the healthcare stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.
|Best Value Healthcare Stocks|
|Price ($)||Market Cap ($B)||12-Month Trailing P/E Ratio|
|Bio-Rad Laboratories Inc. (
|Quidel Corp. (
|Sage Therapeutics Inc. (
- Bio-Rad Laboratories Inc.: Bio-Rad manufactures and distributes life science research products and more than 3,000 clinical diagnostics products. These tools are used to separate and analyze complex chemical and biological materials.
- Quidel Corp.: Quidel develops and manufactures diagnostic healthcare products and solutions. The company’s offerings aid in the detection and diagnosis of critical diseases and other medical conditions. Quidel’s Sofia SARS Antigen FIA, a rapid antigen test for COVID-19, received an emergency use authorization from the U.S. Food and Drug Administration (FDA), according to a press release from April 1. The new the test is intended to be used for asymptomatic individuals.
- Sage Therapeutics Inc.: Sage Therapeutics is a biopharmaceutical company developing novel therapies that seek to treat brain disorders. The FDA approved its first product in 2019 to treat postpartum depression. On April 12, the company announced results from its Phase 2 KINETIC Study evaluating SAGE-324 in the treatment of people with essential tremor. The study showed statistically significant reduction in tremor score compared to placebo. Essential tremor is a movement disorder affecting millions of people in the U.S.
These are the top healthcare stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly year over year (YOY) percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.
|Fastest Growing Healthcare Stocks|
|Price ($)||Market Cap ($B)||EPS Growth (%)||Revenue Growth (%)|
|Quidel Corp. (QDEL)||119.51||5.1||1,420||431.7|
|The Cooper Companies Inc. (
|Seagen Inc. (
- Quidel Corp.: See company description above.
- Cooper Companies Inc.: Cooper Companies is a medical device company. It’s organized into two segments: the CooperVision business manufactures products for contact lens wearers, and CooperSurgical sells diversified products and services, including medical devices, fertility, diagnostics, and contraception.
- Seagen Inc.: Seagen is a biotechnology company that develops and commercializes targeted therapies to treat cancer. In April, Seagen and Astellas Pharma Inc. announced that the FDA had accepted two supplemental Biologics License Application submissions for its drug PADCEV, including the potential for the drug to be used for patients with locally advanced or metastatic urothelial cancer.
These are the healthcare stocks that had the highest total return over the last 12 months.
|Healthcare Stocks with the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|Moderna Inc. (
|Align Technology Inc. (
|Horizon Therapeutics PLC (
|Health Care Select Sector SPDR ETF (XLV)||N/A||N/A||23.9|
- Moderna Inc.: Moderna is a clinical stage biotechnology company focused on the discovery and development of messenger RNA (mRNA) therapeutics and vaccines. It develops mRNA medicines for infectious, immuno-oncology, and cardiovascular diseases. The company’s sales have exploded after winning approval from U.S. and foreign governments to supply its COVID-19 vaccine for millions of people in 2021. Moderna announced on April 19 that it had reached a new supply agreement for its COVID-19 vaccine for 2022, with Israel. Under the agreement, Israel also retains the option to purchase doses of one of the company’s variant-specific vaccine candidates currently subject to regulatory approval. The latest contract follows two earlier agreements with Moderna to supply 10 million doses of COVID-19 vaccines to Israel.
- Align Technology Inc.: Align Technology is a medical device company that designs and manufactures products that help straighten misaligned teeth. One of its product lines is Invisalign.
- Horizon Therapeutics PLC: Horizon Therapeutics is a biopharmaceutical company that develops, acquires, and sells biopharmaceutical therapies used to treat pain and inflammation as well as specialty and orphan diseases. The company announced in early April that its drug KRYSTEXXA, used for the treatment of chronic gout, had shown positive results in a randomized controlled clinical trial.
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