雅虎香港財經 10 Healthcare Stocks to Watch in Light of Biden’s ‘60 Minutes’ Interview
In this article, we will be taking a look at the 10 healthcare stocks to watch in light of Biden's 60 Minutes interview. To skip our detailed analysis of these stocks and Biden's insights, you can go directly to see the 5 Healthcare Stocks to Watch in Light of Biden's 60 Minutes Interview.
On September 13, the annual inflation rate came in at 8.3%, marking the highest inflation rate the US has seen in 40 years. This was one of the key topics up for discussion on CBS News' 60 Minutes with President Joe Biden. The President responded to Scott Pelley's comments on the inflation rate by explaining that the rate itself has continued to stay even while the government is trying to create more jobs for the people. The new administration has created 10 million new jobs since Biden has come into the Oval office, and has brought the unemployment rate down to about 3.7%. On the stock market, Biden is confident that massive investments in the computer chips sector in particular are going to help the market recover from its current fall as well.
While the new government is trying its best to grow new industries and help existing ones survive, Biden's recent interview with CBS has led to the healthcare sector plummeting. By commenting that "the pandemic is over," the President set in motion the fall of major vaccine-making companies, such as Johnson & Johnson (NYSE:JNJ), Pfizer Inc. (NYSE:PFE), and Merck & Co., Inc. (NYSE:MRK). Pfizer Inc. (NYSE:PFE) fell by 1.3% right after the interview was broadcasted, while Moderna, Inc. (NASDAQ:MRNA) fell by 7.1%.
While the pandemic's end is a cause for celebration for all, vaccine-makers might not be too pleased with this publicity. According to a Forbes article, their reign began to end early this year, as Moderna, Inc. (NASDAQ:MRNA) hit an eight-month low this January, falling 4.4% to $160. The company's shares were down by over 20% in mid-January. About $133 billion were wiped from the company's market capitalization by this January. Moderna, Inc.'s (NASDAQ:MRNA) downfall was further exacerbated by the inefficacy of its COVID-19 booster against the Omicron variant which rapidly spread across the globe at the start of this year. Regardless, Biden is confident that the worst of the pandemic has passed, and the health of the people is being restored slowly but surely. In such circumstances, it is becoming crucial to keep a sharp eye on healthcare stocks, especially vaccine-makers with large COVID-19 franchises, as they are definitely set to suffer in the coming months.
Let's now take a look at the 10 healthcare stocks to watch in light of Biden's 60 Minutes interview.
Our Methodology
We have selected healthcare stocks that fell after President Biden's comments on 60 Minutes stating that the pandemic was over. The share prices of most of these stocks have fallen year-to-date, and we have mentioned their year-to-date losses (and gains in some cases) below.
Healthcare Stocks to Watch in Light of Biden's 60 Minutes Interview
10. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 79
Year-to-Date Performance: +12.89%
Merck & Co., Inc. (NYSE:MRK) is a pharmaceutical company operating across the globe. It works through its Pharmaceutical and Animal Health segments to offer products in the areas of oncology, hospital acute care, immunology, and veterinary care. The company is based in Kenilworth, New Jersey.
Shares of Merck & Co., Inc. (NYSE:MRK) were upgraded from Hold to Buy on September 14 by Berenberg's Luisa Hector. The analyst also raised the price target on the stock from $95 to $100.
Merck & Co., Inc. (NYSE:MRK) has been performing well, but after Biden's interview, the company's shares took a hit of 1.1%. The fall occurred during the fourth week of September. The company's EPS is expected to rise by 10.86% over the next three to five years, however, and its operating cash flow growth rate year-over-year is 58.79%. Merck & Co., Inc. (NYSE:MRK) also has a one-year dividend growth rate of 6.35%.
Fisher Asset Management was the largest stakeholder in Merck & Co., Inc. (NYSE:MRK) in the second quarter, holding 12.1 million shares worth $1.1 billion. In total, 79 funds were long the stock, with a total stake value of $6.1 billion.
Chartwell Investment Partners, an asset management company, mentioned Merck & Co., Inc. (NYSE:MRK) in its second quarter 2022 investor letter. Here's what the firm said:
“In the Dividend Equity accounts, the three best performers in Q2 includes Merck (NYSE:MRK, 3.6%), up 12.0%. Merck, like other pharma companies, is in a defensive business, but the stock also did well as peak-sales estimates for their flagship drug, Keytruda, have gone up (JPMorgan estimates $32 billion in sales by 2026).”
Like Johnson & Johnson (NYSE:JNJ) and Pfizer Inc. (NYSE:PFE), Merck & Co., Inc. (NYSE:MRK) is a typically popular healthcare stock that might suffer in light of Biden's recent interview.
9. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 83
Year-to-Date Performance: -3.02%
Johnson & Johnson (NYSE:JNJ) is a healthcare company working to research, develop, manufacture, and sell a range of healthcare and pharmaceutical products across the globe. It is based in New Brunswick, New Jersey. Some of the company's main brands include Johnson's Aveeno, Clean & Clear, and Neutrogena.
Kevin Caliendo at UBS holds a Neutral rating on Johnson & Johnson (NYSE:JNJ) shares as of July 21. The analyst also placed a price target of $180 on the stock.
This September, Johnson & Johnson (NYSE:JNJ) was one of the many vaccine-makers that fell because of Biden's 60 Minutes interview, hosting a 3.02% loss year-to-date. The company's projected EPS growth for the next three to five years is slow, standing at 3.82%, but still represents hope for the future. The company lost 7.58% in share price over the past six months as well.
There were 83 hedge funds holding stakes in Johnson & Johnson (NYSE:JNJ) in the second quarter, and 83 funds were also long the stock in the previous quarter. Their total stake values were $6.7 billion and $7.4 billion, respectively.
8. AstraZeneca plc (NYSE:AZN)
Number of Hedge Fund Holders: 47
Year-to-Date Performance: -6.21%
AstraZeneca plc (NYSE:AZN) is a biopharmaceutical company working to discover, develop, manufacture, and commercialize prescription medicines. The company's products target cardiovascular, renal, metabolism-related, and rare diseases. It is based in Cambridge, UK.
Credit Suisse analyst Dominic Lunn downgraded AstraZeneca plc (NYSE:AZN) shares on September 15 from Outperform to Neutral.
AstraZeneca plc (NYSE:AZN) is one of the largest pharma companies with a sizable COVID-19 franchise, resulting in the company falling 1.24% in the five days a week after Biden's interview. It has lost 6.21% year-to-date. The company's EPS is expected to rise 15.17% over the next three to five years, however. AstraZeneca plc (NYSE:AZN) also has a one-year dividend growth rate of 3.57%
AstraZeneca plc (NYSE:AZN) was found among the 13F holdings of 47 hedge funds in the second quarter, with a total stake value of $4.9 billion. Fisher Asset Management was the largest stakeholder in this company as well, holding 21.4 million shares worth $1.4 billion.
Carillon Tower Advisers, an investment management firm, mentioned AstraZeneca plc (NYSE:AZN) in its first quarter 2022 investor letter. Here's what the company said:
“AstraZeneca (NYSE:AZN) performed strongly and reported encouraging fourth-quarter earnings and initial 2022 guidance. AstraZeneca also announced positive clinical data for two drugs within its oncology business that should serve as important long-term growth drivers.”
7. Gilead Sciences, Inc. (NASDAQ:GILD)
Number of Hedge Fund Holders: 58
Year-to-Date Performance: -11.92%
Gilead Sciences, Inc. (NASDAQ:GILD) is another biopharmaceutical company on our list, working to develop and commercialize medicines in the areas of unmet medical needs. The company operates in the US, Europe, and internationally. It is based in Foster City, California, and offers Veklury, an injection for the treatment of the coronavirus.
Do Kim at Piper Sandler has a Neutral rating on Gilead Sciences, Inc. (NASDAQ:GILD) shares as of September 20. The analyst also placed a $79 price target on the stock.
Shares of Gilead Sciences, Inc. (NASDAQ:GILD) fell 11.92% year-to-date and 1.09% a week after Biden's 60 Minutes interview. The company's projected EPS growth over the next three to five years is modest at best, standing at 0.67%. Gilead Sciences, Inc.'s (NASDAQ:GILD) year-over-year revenue growth rate is also slow, standing at 3.29%.
In total, 58 hedge funds were long Gilead Sciences, Inc. (NASDAQ:GILD) in the second quarter, with a total stake value of $3.9 billion. In the previous quarter, 68 funds were long the stock, with a total stake value of $4.1 billion.
6. GSK PLC (NYSE:GSK)
Number of Hedge Fund Holders: 34
Year-to-Date Performance: -17.88%
GSK PLC (NYSE:GSK) is a healthcare company operating through its subsidiaries to engage in the creation, discovery, development, manufacture, and marketing of pharmaceuticals. The company also deals with vaccines, over-the-counter medicines, and health-related consumer products. It operates in the UK, the US, and internationally.
A Neutral rating was placed on GSK PLC (NYSE:GSK) shares on September 15, by analyst Johanna Walton at Credit Suisse.
GSK PLC (NYSE:GSK) has fallen 33.86% in the past six months and 34.44% year to date. The company suffered not only from Biden's recent comments but also from a WHO warning to not use GSK PLC's (NYSE:GSK) antibody cocktail REGEN-COV to treat COVID-19. Over the next three to five years, the company's EPS is expected to rise by 8.64% and its year-over-year revenue growth rate is 31.23%.
Our hedge fund data shows 34 hedge funds long GSK PLC (NYSE:GSK) in the second quarter. Their total stake value was $2.4 billion.
GSK PLC (NYSE:GSK), like Johnson & Johnson (NYSE:JNJ), Pfizer Inc. (NYSE:PFE), and Merck & Co., Inc. (NYSE:MRK) is a healthcare stock to watch in light of Biden's recent comments.
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Disclosure: None. 10 Healthcare Stocks to Watch in Light of Biden's 60 Minutes Interview is originally published on Insider Monkey.
