Best Stocks to Buy Under Trump: UnitedHealth Group (UNH)
Financial stocks have been obvious winners since Election Day, but some segments of healthcare have also been hot trades thanks to Republicans pledging to dismantle Obamacare and revamp regulations in the industry.
UnitedHealth Group Inc (NYSE:UNH) is the most obvious winner for a world where Obamacare is no more. After all, UNH stock rallied nicely in 2016 on the simple news that, because it wasn’t making money in government-sponsored healthcare exchanges, it would be scaling back those efforts in the coming year.
Now that Donald Trump won the presidency and Republicans have taken the House, that momentum has only increased on the idea that UnitedHealth was ahead of the curve and best prepared to prosper in a new healthcare environment in 2017. UNH has rallied about 20% since the October lows, showing that there is still plenty of upside.
Remember, too, that while the dividend yield of UNH stock is just 1.6%, there is tremendous upside to payouts. Dividends are only about 26% of next year’s earnings and distributions have soared from about 3 cents annually in 2009 to $2.50 annually in 2016! Those who get in at a good price now could enjoy significant payout increases across 2017 and beyond.
The reality is that Obamacare is falling away under Trump, and private insurance is the only game in town. UNH is as stable as they come as a result — and thanks to increased profitability and the near-certainty of increased dividends in 2017, you can rely on this low-risk healthcare play regardless of the broader market environment.