The healthcare sector has dominated headlines this year thanks to promises from the GOP and the Trump administration related to repealing and replacing Obamacare. With the Senate currently working on a reform bill that was passed by the House, healthcare is sure to remain in the news for some time.
While investors might think that the uncertainty of this reform would bring volatility into the sector, we’ve actually seen healthcare stocks have a pretty decent year so far. In fact, our overall “Medical” sector is up about 11.2% year-to-date, which outpaces the gains of the S&P 500.
Within this broad sector, one of the better performing industries has been what we call “Large Cap Pharmaceuticals.” This industry includes some of the world’s largest and most recognizable drug making companies.
You can check out the full industry data at the industry page here, but it’s certainly worth noting that this group of businesses currently sit in the top 10% of the Zacks Industry Rank and has returned nearly 13% on the year.
We know that our best stocks are going to come from the best industries, so it’s clear that investors should be considering Large Cap Pharma stocks right now. But which companies are standing out? Let’s take a closer look.
1. H. Lundbeck (HLUYY – Free Report)
H. Lundbeck is an international pharmaceutical company engaged in the research, development, and sale of pharmaceuticals around the world. The company currently has products that target disorders like depression and anxiety, schizophrenia, insomnia, Huntington’s, epilepsies, Alzheimer’s and Parkinson’s diseases.
Lundbeck is a great example of a large cap stock with solid, consistent growth. Based on our current consensus estimates, we expect sales growth of 8.6% and EPS growth of 30% this year. Next-year estimates call for sales to increase 4.5% and earnings to expand by 9.3%. This growth outpaces many of its large cap rivals, but the stock is also fundamentally sound. Indeed, its “B” grade for VGM underscores this fact and pairs well with its Zacks Rank #1 (Strong Buy) position.
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