Stocks to buy

The 3 Best Healthcare Stocks to Buy in August

Health is undoubtedly the most important thing for all of us. It’s vital to be able to continue with our day-to-day and to be able to carry out everything we want to throughout our lives. There are many important sectors within the financial markets, but the health sector will always be one of the most in demand because, as I mentioned before, taking care of your health is priority number one.

There are many companies within this sector making improvements in products and services, applying technology, science, discoveries and endless innovative tools to bring increased efficiency and effectiveness to the table. Here I bring you the best healthcare stocks to buy right now.

UnitedHealth (UNH)

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Picture UnitedHealth Group (NYSE:UNH) as that reliable friend you turn to for health support, both for yourself and your loved ones. Imagine the company as the unsung heroes working tirelessly behind the scenes to ensure quality healthcare is accessible to all. Whether it’s health insurance or medical services, its mission is to make the path to well-being easier for everyone.

UnitedHealth earns such high praise because it’s akin to a championship team in the realm of healthcare. The company not only demonstrated its prowess but has steadily expanded over time. That makes the business a top-tier choice if you’re considering investing in healthcare. Investing in UnitedHealth is like putting your faith in a time-tested and proven entity.

Let’s delve into its most recent financial performance and brace yourself for some surprising news! In the second quarter of 2023, the company managed to rake in approximately $93 billion in revenue. That marks a substantial 16% upswing from the previous year. What’s more, their earnings grew by an impressive 13%, resulting in about $11 billion in operational cash flow. While the earnings per share might seem around $5.82 initially, when you account for certain adjustments, the figure is actually hovering around $6.14 per share. That signifies UnitedHealth’s outstanding performance and commitment.

But hold on, there’s more to their story. UnitedHealth doesn’t just focus on numbers, it is deeply committed to creating meaningful change within communities. The business launched an initiative called UnitedHealthcare Catalyst in Georgia. Collaborating with other organizations, the company is tackling diabetes head-on. That involves offering health education, managing medications and ensuring access to nourishing food. It’s like extending a helping hand to elevate people’s quality of life.

Merck & Co (MRK)

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Merck & Co. (NYSE:MRK), also known as MSD, is a major player in the healthcare landscape. Its central mission revolves around crafting medications and therapies that foster well-being. This company is a prime contender for healthcare investment, boasting a track record of successful medical advancements. Merck stands as a leader in pivotal fields like cancer treatment and vaccines.

Turning to its most recent financial update, Merck reported global sales amounting to $15.0 billion, an impressive 3% upturn from the preceding year. The growth underscores the company’s upward trajectory. Excluding the contribution of a drug called LAGEVRIO, its expansion was even more remarkable at 11%. This bodes well for potential investors.

In the realm of flagship products, the drug KEYTRUDA, used to combat various cancers, saw an exceptional 19% surge in sales. That’s a substantial leap! Another triumph comes from the vaccine GARDASIL/GARDASIL 9, which experienced a staggering 47% sales hike. However, LAGEVRIO witnessed an 83% dip in sales, warranting some concern.

Beyond the numbers, Merck also presented compelling data at a medical conference. Clinical trials targeting early-stage cancer yielded positive results, promising a brighter future. Additionally, its collaboration with Moderna (NASDAQ:MRNA) in a clinical trial shows encouraging signs.

Thermo Fisher Scientific (TMO)

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Think of Thermo Fisher Scientific (NYSE:TMO) as that brilliant friend who’s always unearthing fascinating discoveries. The company stands as a pioneer in science and health, aiding researchers and pharmaceutical firms in unraveling the intricacies of everything from proteins to medical treatments. Its knack for sparking innovative ideas sets the business apart and makes it an attractive investment in the healthcare sphere. Thermo Fisher’s ongoing innovations, such as an AI-powered super microscope and a precision protein study mass detector, truly make it stand out.

In its latest financial overview, while the company might have slightly dipped in earnings compared to the previous year, its true growth story remains intact. Consider that TMO earned roughly $3.51 per owned share of the company. However, after adjusting certain factors, this figure translates to around $5.15 per share. Despite navigating through a challenging economic climate, its strategic acumen helped weather the storm effectively.

And as if that weren’t impressive enough, Thermo announced its intention to acquire CorEvitas, a move costing about $912.5 million. That development is enthralling because CorEvitas specializes in gathering real-world data from individuals undergoing approved medical treatments. It’s akin to glimpsing into the practical realm of medicine. The data-driven insight empowers pharmaceutical firms to make more informed and prompt decisions — a testament to Thermo Fisher’s commitment to advancing healthcare.

As of this writing, Gabriel Osorio-Mazzilli did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Gabriel Osorio is a former Goldman Sachs and Citigroup employee. He possesses discipline in bottom-up value investing and volatility-based long/short equities trading.