10 Best Healthcare Stocks for the Recession

In this article, we’ll take a look at the 10 best healthcare stocks for the recession. you can skip this part and go The 5 Best Healthcare Stocks for the Recession.

The healthcare sector outperformed the market in 2022 despite several headwinds and a negative macroeconomic backdrop. Data shows that the Health Care Select Sector SPDR exchange-traded fund (XLV) fell only 3.5% on the year, compared to a whopping 20% ​​decline for the SPY. The overall sector was uplifted by a number of positive news from major and small healthcare and biotech companies in terms of their pipelines. The healthcare sector also includes several established players who are consistently paying dividends to their shareholders.

The healthcare sector was one of the biggest losers during the onset of the coronavirus pandemic. But 2022 saw major companies in the sector regain their footing as patients flocked back to doctors’ offices for checkups they skipped during the days of the pandemic. The pandemic is expected to drive nearly $150 billion in sales of new COVID-19 products, including diagnostics, vaccines and therapeutics, according to a November 2022 report by the WSJ. The report also quoted the CFO of UnitedHealth Group, who said in a conference call that the company was “encouraged” to actively encourage people to get preventive screenings.

Major healthcare stocks that gained value in 2022 and are poised for strong performances this year as well, include McKesson Corp, Cardinal Health and Cigna. You’ll see these stocks along with several other players on our list as strong stocks for the bearish.

Healthcare stocks tend to hold steady when others waver because these companies can often pass on higher costs to customers during times of inflation. The healthcare sector is also receiving a positive outlook from major analyst firms in Wall Street. For example, in December, investment firm Citi assigned an Overweight rating to the sector, saying:

“The decision has to do with the defensive sense of the field, while attempting to downgrade from last year’s relatively better performance.”

our methodology

For this article, we used the Finviz Stock Screener to find large-cap healthcare companies that posted positive stock performance (at least 20% gains) in 2022. For each stock, we have mentioned its growth catalysts and why is it a good stock? Recession. The list is arranged in ascending order of the number of hedge funds that have holdings. We used Insider Monkey’s database of 920 funds to measure that metric for each company.

10 Best Healthcare Stocks for the Recession

10. Neurocrine Biosciences, Inc. (NASDAQ:nbx,

Number of hedge fund holders: 44

California-based Neurocrine Biosciences, Inc. is one of the best performers in the healthcare sector in 2022. (NASDAQ: NBIX). Neurocrine Biosciences, Inc. (Nasdaq: NBX) provides treatments for neurological diseases. Neurocrine Biosciences, Inc. (NASDAQ: NBIX) was up nearly 40% last year. Last month, Neurocrine Biosciences (NASDAQ: NBIX) announced that the FDA has accepted its supplemental new drug application (sNDA) for valbenazine for the treatment of movement disorder associated with Huntington’s disease. Neurocrine Biosciences, Inc. (NASDAQ: NBIX) said the authority will make a decision about the sNDA by August 20, 2023. Neurocrine Biosciences, Inc. (NASDAQ: NBIX) has acquired Neurocrine Biosciences, Inc. ) posted Q3 results and raised FY’22 guidance for its drug Ingrezza, which is used to treat tardive dyskinesia (TD). Neurocrine Biosciences, Inc. (Nasdaq:NBX) revenue came in at $387.9 million in the third quarter, beating estimates. Net product sales also increased nearly 31% during the period, totaling $379.3 million.

Hedge Fund Neurocrine Biosciences, Inc. (Nasdaq: NBX) are piling up. As of the end of the third quarter, 44 funds in Insider Monkey’s database held Neurocrine Biosciences, Inc. (NASDAQ: NBIX), compared to 39 funds last quarter. The total value of these shares was around $1.3 billion.

9. Cardinal Health, Inc. (NYSE:CAH,

Number of hedge fund holders: 45

Cardinal Health, Inc. (NYSE:CAH) is one of the best healthcare stocks to weather a recession. Cardinal Health, Inc. (NYSE: CAH) is a dividend magnate, having increased its dividend for more than 25 years without a break. Cardinal Health, Inc. (NYSE:CAH) for 2022 with gains of nearly 49%. In November, Bank of America acquired Cardinal Health, Inc. (NYSE:CAH) to Cardinal Health, Inc. (NYSE) upgraded from Underperform to Neutral, citing its performance. : CAH)’s pharmaceutical segment. This upgrade Cardinal Health, Inc. (NYSE: CAH) posted strong results for the first quarter of FY23.

A team of analysts at BofA, led by Michael Cherney, said they expect Cardinal Health, Inc.

As of the end of the third quarter, 45 hedge funds tracked by Insider Monkey held Cardinal Health, Inc. shares, compared to 44 funds in the previous quarter. (NYSE:CAH) reported a stake. Cardinal Health, Inc. (NYSE:CAH)’s largest stakeholder, Richard S. Pazena was a subsidiary of Pazena Investment Management, whose Cardinal Health, Inc. (NYSE:CAH) had a stake of $182 million.

In its Q3 2022 investor letter, Ariel Investments reviewed Cardinal Health, Inc. (NYSE: CAH) made the following comments regarding:

“Additionally, distributors of pharmaceutical and medical products Cardinal Health, Inc. (NYSE:CAH) advanced in a period when the leadership change was viewed as a positive for shares. Management provided a new profit outlook for fiscal 2023 and announced a reform plan for the medical segment. We are encouraged by these changes and think that CAH’s underlying fundamentals and competitive advantage around preventive maintenance screening and medication management will continue to improve. We believe that evaluating health care companies like CAH that focus on cost optimization and fostering technological efficiency in the supply chain will be rewarded over the long term.

8. Amerisource Bergen Corporation (NYSE:ABC,

Number of hedge fund holders: 47

AmerisourceBergen Corporation (NYSE:ABC) is a strong healthcare stock whose valuation looks gloomy. For the fourth quarter, AmerisourceBergen Corporation (NYSE:ABC) adjusted EPS came in at $2.60, beating estimates by $0.02. Revenue in the quarter rose 3.8% year-over-year to total $61.17 billion, topping estimates by $610 million. For 2023, AmerisourceBergen Corporation (NYSE:ABC) said it expects its revenue to grow between 6% and 8% on a constant currency basis.

AmerisourceBergen Corporation (NYSE:ABC) is also a dividend payer. Back in November, it declared a dividend of $0.485/share, a 5.4% increase from the prior dividend of $0.460. The forward dividend yield at that time was 1.2%.

AmerisourceBergen Corporation (NYSE: ABC) also saw increased interest from smart money during the third quarter. Of the 920 funds tracked by Insider Monkey, 47 had holdings in AmerisourceBergen Corporation (NYSE:ABC). The total value of these bets was $604 million.

7. United Therapeutics Corporation (NASDAQ:UTHR,

Number of hedge fund holders: 47

United Therapeutics Corporation (NASDAQ: UTHR) is one of the best healthcare stocks to weather the downturn. The Maryland-based company is known for its treatment of lung disease. United Therapeutics (NASDAQ:UTHR) stock soared 12% after the company’s Q3 results beat analysts’ estimates. During the third quarter, United Therapeutics Corporation’s (NASDAQ: UTHR) GAAP EPS jumped 43.57% Y/Y to $4.91. Total revenue increased 16% to $516 million during the period.

As of the end of the third quarter, 47 hedge funds tracked by Insider Monkey reported holding stakes in United Therapeutics Corporation (NASDAQ:UTHR). The total value of these shares was $2.5 billion.

6. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX,

Number of hedge fund holders: 49

Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) is a Massachusetts-based biotech company. In December, Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) received a green signal from the FDA for its IND application for VX-522, an mRNA candidate for cystic fibrosis. The treatment is for the approximately 5,000 patients who do not benefit from cystic fibrosis transmembrane conductance regulator (CFTR) modulators. Earlier this month, Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) and Arbor Biotechnologies advanced their partnership, according to which Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) will receive rights to Arbor’s new Precision Editing Technology for up to three diseases.

As of the end of the third quarter, 49 hedge funds tracked by Insider Monkey reported holding stakes in Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX). The total value of these shares was $1.9 billion. The largest stakeholder in Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) was Jim Simmons’ Renaissance Technologies, which owns a $619 million stake in Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX). The second largest stakeholder in Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) according to our database was Ian Sim’s Impax Asset Management with a stake of $202 million.

Artisan Partners made the following comments about Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) in its 2022 third quarter investor letter:

“Biotechnology Company Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) dominates the market for cystic fibrosis (CF) treatments, with limited competition. In addition to solid growth in CF revenue, which delivered better-than-expected results, positive progress in its development pipeline drove shares higher. At the time of our 2021 second quarter purchase, the stock was under pressure due to Vertex’s decision not to pursue late-stage development of VX-864 following regulatory constraints and an unexpectedly unfavorable result. VX-864 is designed to treat alpha-1 antitrypsin deficiency (AATD), an inherited disorder with a strong association with pediatric liver disease. Despite Vertex’s AATD pipeline, the company has nearly two decades of patent protection remaining for its CF franchise. The management maintains a healthy stock of cash and is focusing on research and development. We believe Vertex’s growing geographic presence and expansion of drugs to younger age groups are likely to drive growth in the near term, with long-term benefits from the company’s diversified pipeline.

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Disclosure: none. 10 Best Healthcare Stocks for the Recession Originally published on Insider Monkey.

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