Deep Dive: Wall Street analysts expect gains of up to 64% on their favorite health-care stocks

Deep Dive: Wall Street analysts expect gains of up to 64% on their favorite health-care stocks
Deep Dive: Wall Street analysts expect gains of up to 64% on their favorite health-care stocks
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Deep Dive: Wall Street analysts expect gains of up to 64% on their favorite health-care stocks

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Jeff Reeves made the case for the U.S. health-care sector’s potential, highlighting five ETFs for investors to make broad investments that should weather political storms.

But you might also want to hold individual stocks. So here we follow up by singling out the large-cap health-care stocks that Wall Street analysts favor the most.

The S&P 500 Index

SPX, -0.17%

 has returned 16% this year, led by the information-technology sector, which has returned 30%, followed by health care, at 22%.

One might pause here, thinking it would be unwise to jump in after such big gains, especially with the Trump administration’s announcement that it would halt subsidies to health insurers brought about under the Affordable Care Act. But Trump has indicated he is willing to compromise with members of Congress.

There are valid short-term concerns, and short-term investors who wait may even find opportunities to scoop up bargains. But the long-term thesis for the health-care sector is intact, with an expanding customer base as the population ages, along with continued advancement in research, technology and equipment.

And despite the rumblings from Trump and Republicans in Congress, it seems unlikely that we’ll see a significant decline in the payments by various levels of government into the U.S. health-care system.

So here’s a list of 10 stocks in S&P 500 health-care sector, with majority “buy” ratings and the highest 12-month upside potential implied by consensus price targets among analysts polled by FactSet:

Company Ticker Closing price – Oct. 12 Consensus price target Implied 12-month upside potential Total return – 2017, through Oct. 12
Envision Healthcare Corp.

EVHC, -0.45%

$41.65 $68.21 64% -34%
Allergan PLC

AGN, -1.22%

$204.08 $267.79 31% -3%
Incyte Corp.

INCY, +0.99%

$112.73 $147.84 31% 12%
Hologic Inc.

HOLX, -0.27%

$36.56 $46.19 26% -9%
Universal Health Services Inc. Class B

UHS, -1.70%

$105.92 $131.38 24% 0%
HCA Healthcare Inc.

HCA, -1.73%

$74.22 $91.50 23% 0%
Edwards Lifesciences Corp.

EW, -0.24%

$110.20 $130.62 19% 18%
Vertex Pharmaceuticals Inc.

VRTX, -0.03%

$153.98 $180.12 17% 110%
Alexion Pharmaceuticals Inc.

ALXN, +0.16%

$141.46 $163.76 16% 2%
Laboratory Corp. of America Holdings

LH, +0.66%

$150.26 $172.35 15% 10%
Source: FactSet

You can click on the tickers for additional information about each company, including news, price ratios, charts and financial information.

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