Analysts have benefited greatly from this undervalued healthcare stock, After the market crash in 2021, healthcare stocks will outperform the S&P 500 in 2022. Some health stocks are still struggling from the impact of the Covid-19 pandemic, while others are benefiting from the reopening of the election process. Medical stocks are a great defensive strategy in the face of rising interest rates and ongoing economic uncertainty. The Centers for Medicare and Medicaid Services predicts that US healthcare spending will reach $6.8 trillion by 2030, providing excellent opportunities for long-term investment. Here are the top 10 healthcare stocks to buy in 2022, according to CFRA analysts:
United Health Group Inc. (Symbol: UNH)
UnitedHealth is the nation’s largest managed care organization. Analyst David Holt said UnitedHealth’s entry into the market in several new states through the Affordable Care Act would act as a stock deterrent. In addition, UnitedHealth’s $8 billion acquisition of healthcare technology company Change Healthcare will strengthen UnitedHealth Optum’s technology and create significant cost synergies, he said. Holt expects 8% revenue growth in 2023 and says UnitedHealth’s long-term goal is to achieve revenue growth of 13% to 16% annually. CFRA has a strong buy rating and a target price of $650 for UNH shares, which closed on December 5 at $535.04.
Since the start of 2020, shares of Moderna, maker of the Covid-19 vaccine, are up more than 800%. (MRNA) and Covid-19 vaccine partner Pfizer BioNTech SE (BNTX) is up nearly 400%. Meanwhile, Pfizer’s shares only rose 38% over the same period. Investors may be disappointed by Pfizer’s poor performance, but analyst Stuart Glickman says Pfizer has a long list of drug candidates that could generate $20 billion in sales by 2030. They say there are limits. Most of the development candidates were developed domestically, indicating that Pfizer should not make the acquisition. CFRA has a strong buy rating and a target price of $62 for PFE shares, which closed on December 5 at $50.73.
Merck & Company (MRK)
Merck is one of the major pharmaceutical corporations in the world. Merck recently reported revenue growth of 14% in the third quarter. This includes a 20% increase in sales of the major cancer drug Keytruda. Merck Gardasil’s HPV vaccine sales also increased by 15%. Glickman said Merck made the right decision in acquiring the Organon & Co (OGN) business to build on a slow-growing business and focus on key growth drivers. Glickman said Merck’s oral molnopyravir for the treatment of Covid-19 would be a source of near-term growth, and Merck’s acquisition of Acceleron Pharma would strengthen its position in the cardiovascular market. CFRA has a Firm Buy recommendation for MRK stock with a closing price of $110.01 and a target price of $116.00.
Abbott Laboratories (ABT)
Abbott Laboratories is a diversified healthcare company and a member of an exclusive club called Dividend Aristocrats, a select group of S&P 500 stocks that have hiked their dividends for at least 25 consecutive years. In December 2021, Abbott increased its quarterly dividend by 4.4%, from 45 cents per share to 47 cents per share, with a current dividend yield of 1.8%. Last year, Abbott investors experienced dividend increases for 50 straight years. Analyst Colin Scarola says Abbott’s dividend growth is the main reason Abbott’s stock outperforms its peers over the long term. CFRA has a buy rating and a target price of $110 for ABT shares, which closed on December 5 at $105.41.
CVS Health Society (CVS)
CVS Health is the nation’s largest drugstore healthcare provider. Analyst Arun Sundaram said CVS has a strong balance sheet, attractive valuation, and strong cash flow. He is also pleased with the company’s transformation from a simple pharmacy to a full-service provider. CVS currently sells insurance, provides primary health care, and administers prescription drugs. Recently, the company closed a major deal to acquire home healthcare provider Signify Health.
Cigna is one of the largest institutions and wants to benefit investors in the economy. Sundaram expects strong long-term growth for the Cigna Healthcare and Evernorth divisions. The company is also furthering several strategic initiatives, including expansion of US government services, international expansion, and digital, home, and human health services, he said. In addition, Cigna invests in improving its technology. Sundaram said selling its life and disability division to the slower-growing Cigna was the right move, allowing it to gain more influence in years to come. CFRA has a rating and a $370 price target on CI shares, which traded at $327.39 on December 5.
Vertex Pharmaceuticals (VRTX)
Vertex Pharmaceuticals is a biopharmaceutical company specializing in the development of treatments for cystic fibrosis. The market share peaked in 2022. The stock is up 44.6% through December 5, making it the best performer on the list. Glickman Vertex says it is the market leader for cystic fibrosis. This is an activity that helps support the company’s expansion into non-core markets such as sickle cell disease and beta-thalassemia. Glickman is particularly excited about the potential treatment of sickle cell disease with CTX001. Peak revenue is expected to grow by 6.2% in 2023.
Moderna is the first biotechnology company to specialize in mRNA-based therapies. Investors are likely familiar with Moderna because of the popularity of its Covid-19 vaccine, but Glickman notes that Moderna uses its mRNA vaccine technology for influenza, respiratory syncytial virus (RSV), and cytomegalovirus (the company trusts in its long-term potential). spread to other areas such as CMV). With Moderna’s shares up nearly 40 percent over the past year and likely to retain a significant share of the global Covid-19 vaccine market, Glickman said the stock is likely to hold firm and is expected to be attractive. CFRA has a Buy rating and a $219 price target on MRNA shares, which closed below $175.93 on December 5.
Boston Science Corporation (BSX)
Boston Scientific is a medical device manufacturer specializing in cardiovascular, rhythmic, and surgical techniques. Boston Scientific shares are trading at 23.9 times CFRA’s 2023 earnings guidance, and analyst Garrett Nelson believes the shares are fair value. He said the company’s recent product launches and active development process have positioned it well for long-term growth. We expect total revenue to grow by 7% in 2023.