SPECIAL REPORT The Top 7 Stocks for 2024

3 Healthcare Stocks Getting Help From the Aging Population

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  • From vaccines to devices to disease treatments, healthcare stocks are growing just as fast as the aging population.
  • DexCom (DXCM): DexCom’s strong Q3 results suggest worries of the impact of weigh loss drugs on DXCM are overdone. 
  • GSK (GSK): Two of their vaccines for reducing impacts of RSV and shingles are proving successful. 
  • Tenet Healthcare (THC): The hospital network is generating continued strong financial results.
aging population - 3 Healthcare Stocks Getting Help From the Aging Population

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A record number of Americans are now turning 65, Forbes recently reported, amid tens of millions of Baby Boomers. In fact, according to one report, 76.4 million Baby Boomers are living in America currently.

Consequently, the demand for healthcare services for aging individuals in the U.S. is prolific. Companies including drugmakers, medical device manufacturers, hospital and nursing home owners are benefitting. In addition, many Americans are living longer than ever.

Thus, wise investors are looking closely at these three best healthcare stocks of companies poised to continue thriving for many decades to come.

DexCom (DXCM)

Dexcom (DXCM) logo on an app store page on a mobile phone
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DexCom (NASDAQ:DXCM) develops and markets devices used by diabetes patients to measure their glucose levels. According to WebMD, over 90% of diabetes patients have Type 2 diabetes, with age being a big risk factor.

With DexCom’s Q3 results, many investors were worried that the firm’s results would be hurt by new weight-loss drugs. However, those treatments only lower weight by 15%-20%. Also, many patients are likely to discontinue use because they are administered through injections and have multiple, undesirable side effects.

Further, the company’s revenue jumped 27% year over year (YOY) to $976 million. It came in at $38 million ahead of analysts’ average estimate. In addition, earnings per share soared 78% YOY to 50 cents. Moreover, DXCM raised its 2023 sales outlook to $3.575 billion to $3.6 billion, from $3.5 billion to $3.55 billion.

On average, analysts expect the company’s earnings per share to jump to $1.60 in 2024 from 87 cents last year.

GSK (GSK)

A GlaxoSmithKline (GSK) office in London.
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Two of U.K.-based GSK’s (NYSE:GSK) vaccines primarily taken by older individuals reduce the impact of the RSV and shingles viruses. In turn, they are generating large amounts of revenue for GSK.

GSK’s RSV shot, Arexvy, was recently introduced, generating an impressive $700 million of revenue during the quarter. Also, Shingrix contributed 800 million British pounds in sales, showing that the latter jab is still going strong. Notably, GSK recently launched a partnership to promote Shingrix in China.

Another prevalent disease among older individuals is cancer, and GSK’s cancer drug, Jemperli, may become a blockbuster.

And in a recent clinical trial, Jemperli “demonstrated a 25% lower risk of death in patients with newly diagnosed nonsquamous non-small cell lung cancer”.

Globally, lung cancer is the second most prevalent type of cancer. And, non-small cell lung cancer (NSCLC) accounts for 81% of all lung cancer cases in America.

Tenet Healthcare (THC)

stethoscope on a stock chart representing healthcare stocks to buy. Healthcare Stocks
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Tenet Healthcare (NYSE:THC), one of the largest U.S. hospital networks, stands well-positioned to benefit from the aging of America.

The company’s Q3 results indicate strong financial performance. Specifically, THC’s EBITDA, excluding certain items, climbed 8% YOY to $851 million last quarter. In addition, its net operating revenues advanced 5.5% YOY to $5.066 billion.

More impressively, cash flows from operating activities in the first three quarters more than doubled to $1.55 billion from $662 million.

CEO Saum Sutaria suggests that THC has a very bright future.

“The aging of the population, the growing burden of chronic illness, the population shifts into many of our markets, and the continued impacts of service and technology innovation that occur outside of the pharmaceutical sector provide a significant tailwind for the important role that hospitals and (Ambulatory Surgical Centers) will continue to play,” said Sutaria.

On the date of publication, Larry Ramer 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 InvestorPlace.com Publishing Guidelines.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been SMCI, INTC, and MGM. You can reach him on Stocktwits at @larryramer.


Article printed from InvestorPlace Media, https://investorplace.com/2023/11/3-healthcare-stocks-getting-help-from-the-aging-population/.

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