Yahoo Finanza Best Healthcare Stocks To Buy Now
Key Insights
Some healthcare stocks have outperformed S&P 500 this year amid rising demand for safe-haven assets.
Johnson & Johnson has recently tested all-time highs and remains reasonably valued.
While some healthcare stocks look rather expensive, Pfizer could be bought at less than 10 forward P/E.
Recent trading sessions have been volatile, and investors continue to search for safe-haven assets. Healthcare stocks have often served in this role, so let’s take a look at the leaders in this market segment.
Johnson & Johnson
A traditional “widow-and-orphan” stock, Johnson & Johnson is trading near all-time highs despite the recent pullback of S&P 500.
The stock is trading at roughly 17 forward P/E, which is not cheap for an established company. However, the current valuation reflects the high demand for Johnson & Johnson stock and its safe dividend.
It should be noted that analyst estimates have started to move lower in recent weeks, but these changes failed to put any pressure on Johnson & Johnson.
Eli Lilly
Eli Lilly is more expensive than Johnson & Johnson. The stock has pulled back from recent highs, but it is still trading at an expensive 31 forward P/E.
The market is ready to pay a premium for Eli Lilly stock as earnings estimates are increasing at a robust pace. The potential increase of demand for safe-haven assets could provide more support to Eli Lilly shares.
Pfizer
Pfizer stock has lost momentum in recent months as traders focused on the weaker-than-expected demand for the company’s antiviral drug Paxlovid. In addition, all vaccine stocks have found themselves under pressure as traders believed that the acute phase of the coronavirus pandemic was coming to an end.
However, Pfizer is not a one trick pony, and its revenue base is stable. Currently, analysts expect that Pfizer will report earnings of $5.58 per share in the next year, so the stock is trading at less than 9 forward P/E. Such valuation levels could attract value-oriented investors.
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This article was originally posted on FX Empire
