In this article, we will take a look at the 5 best healthcare stocks for recession. You can skip this part and go to 10 Best Healthcare Stocks For Recession.
5. McKesson Corporation (NYSE:MCK)
Number of Hedge Fund Holders: 51
McKesson Corporation (NYSE:MCK) is one of the most notable healthcare companies in the US. McKesson Corporation (NYSE:MCK) has gained about 51% over the past year, as of January 18.
McKesson Corporation (NYSE:MCK) is a hedge fund favorite. As of the end of the third quarter, 51 hedge funds tracked by Insider Monkey had stakes in McKesson Corporation (NYSE:MCK), compared to 47 funds in the previous quarter. The total value of these stakes was $4.1 billion. The biggest stakeholder of McKesson Corporation (NYSE:MCK) as of the end of September was legendary investor and billionaire Warren Buffett’s Berkshire Hathaway, which had a $1.1 billion stake in McKesson Corporation (NYSE:MCK).
4. Sarepta Therapeutics, Inc. (NASDAQ:SRPT)
Number of Hedge Fund Holders: 52
Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is a biotech company. Sarepta Therapeutics, Inc. (NASDAQ:SRPT) gained about 100% in value in 2022. The future outlook of Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is also strong, which makes it one of the best healthcare stocks for recession. Earlier this month Sarepta Therapeutics, Inc. (NASDAQ:SRPT) announced that its net product revenue in Q4 was expected to come in at about $235.5 million, which would be about 32% more than the revenue posted in the comparable period last year. Sarepta Therapeutics, Inc. (NASDAQ:SRPT) said this revenue growth was driven by its three RNA-based PMO therapies. In November, FDA accepted Sarepta Therapeutics, Inc. (NASDAQ:SRPT)’s marketing application for gene therapy candidate SRP-9001. Sarepta Therapeutics, Inc. (NASDAQ:SRPT) makes this treatment with Roche.
Hedge fund sentiment for Sarepta Therapeutics, Inc. (NASDAQ:SRPT) spiked in the third quarter of 2022. Of the 920 funds tracked by Insider Monkey, 52 funds reported having stakes in Sarepta Therapeutics, Inc. (NASDAQ:SRPT) at the end of the third quarter, compared to 41 funds in the previous quarter.
3. Biogen Inc. (NASDAQ:BIIB)
Number of Hedge Fund Holders: 70
Biogen Inc. (NASDAQ:BIIB) is one of the notable healthcare stocks that might be a strong pick for recessions since Biogen Inc. (NASDAQ:BIIB) has growth potential and several catalysts that can boost its value. Biogen Inc. (NASDAQ:BIIB) is currently in the news after the FDA earlier this month granted accelerated approval to Biogen (NASDAQ:BIIB) and Eisai’s (OTCPK:ESALY) drug that is made for the treatment of Alzheimer’s disease.
The drug, named Leqembi (lecanemab), is expected to be available later this month and its wholesale cost will be about $26,500 per year based on twice monthly infusions. However, analysts are in a wait-and-see mode regarding the drug since Biogen Inc. (NASDAQ:BIIB) has a history of getting approval for a similar treatment in the past which failed to show strong results.
Hedge funds are buying stakes in Biogen Inc. (NASDAQ:BIIB). As of the end of the third quarter, 70 hedge funds reported having stakes in Biogen Inc. (NASDAQ:BIIB), compared to 54 funds in the previous quarter. The biggest stakeholder of Biogen Inc. (NASDAQ:BIIB) during this period was Steve Cohen’s Point72 Asset Management $448 million.
ClearBridge Investments made the following comment about Biogen Inc. (NASDAQ:BIIB) in its Q3 2022 investor letter:
“Biogen Inc. (NASDAQ:BIIB) was the leading contributor among several biopharma names, boosted by positive, pivotal clinical data for its next-generation Alzheimer’s treatment Lecanemab. In a pivotal trial, the drug proved safe and efficacious in slowing progression of Alzheimer’s disease.”
2. Cigna Corporation (NYSE:CI)
Number of Hedge Fund Holders: 76
Cigna Corporation (NYSE:CI) outperformed the market in 2022. On a TTM basis Cigna Corporation (NYSE:CI)’s revenue stands at about $190 billion. Cigna Corporation (NYSE:CI)’s cash position also remains strong. It has about $7 billion in cash as of the end of 2022, which shows a 40% jump as compared to 2021. Cigna Corporation (NYSE:CI)’s debt position also shows that there is no short-term risk to the company. Cigna Corporation (NYSE:CI) has about $9 billion in free cash flow as of the last 12 months. Cigna Corporation (NYSE:CI)’s short-term debt stands at $3.4 billion and its long-term debt is $28 billion. Cigna Corporation (NYSE:CI) is also a dividend stock with a dividend yield of about 1.42% as of January 17.
Hedge fund sentiment is also strong for Cigna Corporation (NYSE:CI). It has 76 hedge funds with stakes in it as of the end of the third quarter, compared to 66 funds in the previous quarter.
Aristotle Atlantic made the following comment about Cigna Corporation (NYSE:CI) in its Q3 2022 investor letter:
“Cigna Corporation (NYSE:CI) outperformed the S&P 500 Index in the third quarter, as the company reported what we view as solid second quarter results driven by a better-than-expected medical loss ratio. The company continues to be aggressive with share repurchases and we believe the defensive nature of Cigna’s business continues to be attractive during the ongoing macroeconomic uncertainty.”
1. Humana Inc. (NYSE:HUM)
Number of Hedge Fund Holders: 76
Humana Inc. (NYSE:HUM) is one of the biggest health insurance companies in the US. In December, Humana Inc. (NYSE:HUM) was a awarded a potential contract worth a whopping $70.85 billion to provide managed care support to the Department of Defense, Defense Health Agency, TRICARE program in the East Region. Humana Inc. (NYSE:HUM) will help the Defense Health Agency in operating an integrated health care delivery system to provide health, medical and administrative support services to the members of the uniformed services, retirees and their eligible family members. In November, Humana Inc. (NYSE:HUM) shares made headlines after the company announced plans to buy back about $1 billion worth of its shares under accelerated share repurchase agreements with Goldman Sachs and Mizuho as part of a $3 billion stock repurchase program announced in February 2022.
At the end of the September quarter, 76 hedge funds of the 920 funds in Insider Monkey database reported having stakes in Humana Inc. (NYSE:HUM). The collective value of these stakes was $4.3 billion.
Renaissance Investment made the following comment about Humana Inc. (NYSE:HUM) in its Q3 2022 investor letter:
“In September, We added a new position in the Health Care sector with Humana Inc. (NYSE:HUM), one of the largest managed care providers in the U.S. with a focus on medical insurance for the Medicare Advantage market. We believe Humana is poised to see a reacceleration in Medicare Advantage membership growth after making large investments in its program benefits earlier this year. In addition, we like the demographic tailwinds for the entire Medicare Advantage market, as the next four years should provide the highest number of baby boomers yet qualifying for Medicare benefits.”
You can also take a peek at 12 Best Holding Company Stocks To Invest In and 12 Best Bid Data Stocks To Buy.
