S&P 500   3,841.47
DOW   30,996.98
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S&P 500   3,841.47
DOW   30,996.98
QQQ   325.42
S&P 500   3,841.47
DOW   30,996.98
QQQ   325.42
S&P 500   3,841.47
DOW   30,996.98
QQQ   325.42
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The Top 3 Healthcare Stocks for 2021

Saturday, December 5, 2020 | Sean Sechler
The Top 3 Healthcare Stocks for 2021

When you consider the fact that we’ve been dealing with the largest global health crisis in recent memory, it makes a lot of sense to explore some of the best healthcare stocks heading into 2021. Hopefully, we will be able to put the pandemic behind us next year and return to normalcy, but the truth is that we won’t be able to accomplish that without help from the healthcare industry. There’s also the possibility of sweeping changes to the healthcare system as President-Elect Joe Biden begins his term.

While there are plenty of great healthcare stocks to choose from, investors might want to focus on companies that are working on a vaccine or a treatment for the COVID-19 virus, companies that have shown resilience during economic downturns, and companies that are are at the forefront of the digital health revolution. We’ve put together a list of the top 3 healthcare stocks for 2021 to help you add some intriguing opportunities to your investment plans.

Johnson & Johnson (NYSE:JNJ)

There are several reasons to consider adding shares of this global leader in the pharmaceutical, medical device, and consumer health care products industries. Johnson & Johnson has proven to be a resilient business over the years. The company reported a year-over-year sales increase of 1.7% in Q3 along with year-over-year EPS growth of 101.5%, which is impressive amidst the negative impacts of the pandemic. Thanks to its diverse product categories, investors can typically expect this stock to hold up well throughout different economic cycles.

There’s also the fact that Johnson & Johnson has a COVID-19 vaccine candidate with some noteworthy advantages. It only requires one dose and can be transported without the special infrastructure limitations that other vaccines are subject to. While the Phase 3 clinical trials for Johnson & Johnson’s vaccine candidate were temporarily halted, the trials will restart soon and could lead to prolific results. Finally, investors should consider the fact that Johnson & Johnson stock offers a 2.69% dividend yield along with a strong balance sheet with low debt levels. While there isn’t necessarily one standout growth driver for this stock in 2021, it’s still one of the best options in healthcare thanks to its numerous strengths.

Intuitive Surgical (NASDAQ:ISRG)

Another solid pick in the healthcare sector for 2021 and beyond is Intuitive Surgical. This is a company that has developed cutting-edge technology that allows surgeons to perform robotic-assisted surgery. The da Vinci robotic surgical system that the company pioneered is helping to make surgery more effective, less invasive, and a better overall experience for both patients and doctors. The stock is up over 30% year-to-date despite the challenges that the company has faced related to the pandemic and looks to be headed to new all-time highs before the year is over.

COVID-19 negatively impacted Intuitive Surgical this year since surgical procedures experienced a major slowdown. However, there are some encouraging signs that the volume of surgeries is heading in the right direction. Worldwide da Vinci procedures increased by 7% year-over-year in Q3, which is a good indication for the company’s 2021 prospects. Investors should be attracted to the company’s wide economic moat and the fact that it’s a business combining artificial intelligence, robotics, and healthcare in a truly groundbreaking way.

CVS Health (NYSE:CVS)

If you are interested in a healthcare stock that is seriously undervalued and could be in store for a very successful 2021, look no further than CVS Health. It’s the largest pharmacy health care provider in the U.S. and should benefit from a recent CEO change along with the expansion of the company’s HealthHUB stores. These are stores that offer expanded health care services and offerings that can help patients avoid going to the hospital and with managing chronic conditions conveniently and affordably. CVS Health has plans to expand its HealthHUB model to 1,500 locations by the end of 2021.

This company has also been providing COVID-19 testing to millions during the pandemic, which is bringing new customers into its stores. There’s also the fact that CVS Health will play a crucial role in distributing the COVID-19 vaccines once they are available. Over 70% of the U.S. population lives within three miles of a CVS store, which is a staggering statistic. Finally, thanks to the company’s ownership of Aetna, CVS Health could potentially benefit from the growth in Medicaid under a Joe Biden presidency.

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Johnson & Johnson (JNJ)2.3$163.55flat2.47%25.72Buy$166.69
Intuitive Surgical (ISRG)1.7$744.08flatN/A84.75Hold$736.06
CVS Health (CVS)2.5$74.12flat2.70%12.25Buy$82.93
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7 Post-Inauguration Stocks to Buy For Under $20

There’s a new occupant (officially) at 1600 Pennsylvania Avenue and the stock market is doing its part to promote unity. The Dow shot to a record high on Inauguration Day. We don’t imagine the honeymoon will last long. However it serves as a reminder that investors are more interested in the “what” more than “what party” when it comes to the way it moves.

With that said, many investors are attempting to read the tea leaves of the nascent Biden administration. One of the challenges will be that many of the usual suspects such as the FAANG stocks remain popular, yet frighteningly expensive (in terms of share price).

Valuation is in the eye of the beholder. But some investors may be looking for low-priced stocks that can get them more bang for their buck. The good news is that there are many stocks that you can buy for under $20 that not only show impressive growth, but are leaning in to the macroeconomic issues that will be present during at least the early part of the Biden administration.

In this special presentation, we’re giving you seven of our picks for low-priced stocks you can buy for under $20 today. But take note, these stocks may easily be over $20 in the next few months.

View the "7 Post-Inauguration Stocks to Buy For Under $20".

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