5 Best Mid-Cap Healthcare Stocks To Buy Now

In this article, we discuss 5 best mid-cap healthcare stocks to buy now. If you want to see more stocks in this selection, check out 11 Best Mid-Cap Healthcare Stocks To Buy Now. 

5. Intellia Therapeutics, Inc. (NASDAQ:NTLA)

Number of Hedge Fund Holders: 39

Intellia Therapeutics, Inc. (NASDAQ:NTLA) is a genome editing company that focuses on the development of curative therapeutics for transthyretin amyloidosis, hereditary angioedema, deficiency-liver disease, deficiency-lung disease, lymphomas, hemophilia A and hemophilia B, acute myeloid leukemia, and various cancers and autoimmune diseases. It is one of the best healthcare stocks to invest in. 

On April 13, Whitney Ijem, an analyst at Canaccord, gave Intellia Therapeutics, Inc. (NASDAQ:NTLA) a Buy rating with a price target of $66. According to the analyst, the company’s focus on in-vivo gene editing in large, rare indications may not be the quickest route to the clinic compared to other CRISPR-based companies, but Intellia Therapeutics, Inc. (NASDAQ:NTLA)’s methodical approach has yielded positive results. The Phase 1 data from Intellia’s lead program, NTLA-2001, in ATTR, and wholly-owned NTLA-2002 in HAE, is said to look promising in terms of both safety and efficacy. The company’s progress through Phase 2 and into pivotal studies over the next 6-12 months is expected to provide additional opportunities for value creation, the analyst told investors. 

According to Insider Monkey’s fourth quarter database, 39 hedge funds were bullish on Intellia Therapeutics, Inc. (NASDAQ:NTLA), compared to 36 funds in the prior quarter. Cathie Wood’s ARK Investment Management is the largest stakeholder of the company, with 9.4 million shares worth $328.7 million. 

Carillon Tower Advisers discussed its stance on Intellia Therapeutics, Inc. (NASDAQ:NTLA) in its Q2 2021 investor letter.

“Intellia Therapeutics is a clinical-stage genome editing company focused on the development of proprietary, potentially curative therapeutics. The company’s stock soared after announcing positive interim data from an ongoing phase 1 clinical study of its in vivo gene editing candidate, which is being developed as a single-dose treatment for hereditary transthyretin (ATTR) amyloidosis. This specific form of therapy would be the first of its kind resulting in the precision editing of a gene in a target tissue in the human body.”

4. Bausch Health Companies Inc. (NYSE:BHC)

Number of Hedge Fund Holders: 41

Bausch Health Companies Inc. (NYSE:BHC) is involved in the development, production, and commercialization of a variety of pharmaceutical, medical device, and over-the-counter products, with a primary focus on the areas of eye health, gastroenterology, and dermatology. In the fourth quarter of 2022, Bausch Health Companies Inc. (NYSE:BHC)’s revenue of $2.2 billion outperformed Wall Street estimates by $60 million. It is one of the best healthcare stocks to invest in. 

In mid-November last year, Evercore ISI analyst Umer Raffat said the FDA has released new guidance for generic Xifaxan that is specifically tailored to the product. The “key change” in this guidance is that the waiver for in vivo testing for the 550 mg strength based on 200 mg testing is no longer granted. This means that generics will have to jump through an additional hurdle, according to Raffat, who noted that the 550 mg dose is the most important as it represents 99% of Xifaxan’s volume. The analyst assigned Bausch Health Companies Inc. (NYSE:BHC)’s stock an In Line rating.

According to Insider Monkey’s fourth quarter database, 41 hedge funds were bullish on Bausch Health Companies Inc. (NYSE:BHC), compared to 44 funds in the last quarter. John Paulson’s Paulson & Co is the biggest stakeholder of the company, with 26.4 million shares worth $166 million. 

Here is what Miller Value Partners Opportunity Trust Fund has to say about Bausch Health Companies Inc. (NYSE:BHC) in its Q2 2022 investor letter:

“Bausch Health Companies Inc. (NYSE:BHC) declined during the quarter as the company consummated its Bausch+Lomb IPO at valuations far below expectations, reported disappointing Q1 2022 results, and delayed its plan to spin out its Solta (aesthetics) business due to difficult market conditions. While the company spun off 10% of Bausch+Lomb (BCLO) they retained 90% of the company which they intend to distribute once they have met their target leverage ratio of 6.5-6.7x. The future spin-off value of the Bausch+Lomb piece represents a value of $12.55 per share, 39% above where Bausch Health is currently trading. The company recently appointed John Paulsen as Chair of the Board, which should accelerate value realization.”

3. Lantheus Holdings, Inc. (NASDAQ:LNTH)

Number of Hedge Fund Holders: 44

Lantheus Holdings, Inc. (NASDAQ:LNTH) operates globally and is involved in the development, production, and sale of diagnostic and therapeutic products that help doctors diagnose and treat a range of conditions including heart disease, cancer, and other illnesses. On April 24, Lantheus Holdings, Inc. (NASDAQ:LNTH) and POINT Biopharma Global Inc. (NASDAQ:PNT) disclosed that they have been given Fast Track designation by the US FDA for their candidate Lu-PNT2002, which is intended for the treatment of metastatic castration resistant prostate cancer. The Fast Track designation enables an accelerated review process, potentially leading to a quicker path to market for the asset.

On April 12, Truist raised the firm’s price target on Lantheus Holdings, Inc. (NASDAQ:LNTH) to $115 from $94 and kept a Buy rating on the shares. Truist’s model has been updated based on additional research and feedback from industry experts, which indicates that Lantheus Holdings, Inc. (NASDAQ:LNTH)’s previous assumptions regarding the anticipated decline in Pylarify’s average selling price were too conservative. As a result, the updated model predicts less pricing pressure on Pylarify and a more moderate decline in market share over the coming years compared to Truist’s previous projection.

According to Insider Monkey’s fourth quarter database, 44 hedge funds were bullish on Lantheus Holdings, Inc. (NASDAQ:LNTH), compared to 35 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the biggest stakeholder of the company, with 770,478 shares worth $39.2 million. 

Carillon Eagle Small Cap Growth Fund made the following comment about Lantheus Holdings, Inc. (NASDAQ:LNTH) in its Q4 2022 investor letter:

“Lantheus Holdings, Inc. (NASDAQ:LNTH) provides imaging diagnostics, targeted therapeutics, and artificial intelligence solutions used to fight serious medical conditions. Despite another strong quarterly update, the stock came under pressure due in part to investor concerns regarding a possible deceleration of revenue growth in the company’s leading product, Pylarify, as the company seems to have penetrated most of the early adopters of this imaging agent for prostate cancer. Later in the quarter, the company announced a strategic collaboration and exclusive licensing agreement for two late-stage therapeutic products used for the treatment of metastatic prostate cancer and neuroendocrine tumors. We believe approval of these products should help offset any significant declines in revenue growth of Pylarify.”

2. Prometheus Biosciences, Inc. (NASDAQ:RXDX)

Number of Hedge Fund Holders: 47

Prometheus Biosciences, Inc. (NASDAQ:RXDX) is a biotechnology company that is currently in the clinical stage of development. The company is focused on identifying, creating, and selling innovative treatments for a range of inflammatory bowel diseases, Crohn’s disease, ulcerative colitis, and systemic sclerosis-associated interstitial lung disease. 

On April 17, Credit Suisse analyst Tiago Fauth lowered Prometheus Biosciences, Inc. (NASDAQ:RXDX)’s rating from Outperform to Neutral and has set a price target of $200 following Merck’s announcement of its acquisition of the company for $10.8 billion in cash, or $200 per share.

According to Insider Monkey’s fourth quarter database, 47 hedge funds were bullish on Prometheus Biosciences, Inc. (NASDAQ:RXDX), up from 25 funds in the prior quarter. Steve Cohen’s 72 Investment Holdings is the biggest position holder in the company, with 1.8 million shares worth $203.2 million. 

Alger Small Cap Focus Fund made the following comment about Prometheus Biosciences, Inc. (NASDAQ:RXDX) in its Q4 2022 investor letter:

“Prometheus Biosciences, Inc. (NASDAQ:RXDX) is a biotechnology company focused on developing precision-based medicines to treat autoimmune conditions, primarily those afflicting the intestines such as inflammatory bowel disease (IBD) indications like ulcerative colitis and Crohn’s disease by leveraging a proprietary bioinformatics database. Shares outperformed during the period as the company reported positive Phase 2 clinical trial results from its (BD study, as the drug demonstrated significant patient improvement that was well above expectations. We believe Prometheus is an example of a company with “great discovery value”, as they could potentially be the leader and first-in-class precision-based drug to treat autoimmune diseases.”

1. Tenet Healthcare Corporation (NYSE:THC)

Number of Hedge Fund Holders: 59

Tenet Healthcare Corporation (NYSE:THC) is a healthcare services company that operates hospitals, surgical centers, and other healthcare facilities. The company offers a broad range of healthcare services, including diagnostic imaging, laboratory services, and rehabilitation services. It is one of the best healthcare stocks to invest in. 

On April 20, Cantor Fitzgerald analyst Sarah James gave Tenet Healthcare Corporation (NYSE:THC) an Overweight rating and set a price target of $73. The analyst believes that Tenet Healthcare Corporation (NYSE:THC) is well-positioned to experience significant margin expansion over the long term due to its recent acquisitions and the establishment of new facilities. The company is also reportedly gaining a larger share of the ambulatory surgery center market, which is currently growing at a fast pace. Additionally, the company is improving its margin through commercial pricing strategies, the analyst told investors in a research note. 

According to Insider Monkey’s fourth quarter database, 59 hedge funds were bullish on Tenet Healthcare Corporation (NYSE:THC), compared to 60 funds in the prior quarter. Larry Robbins’ Glenview Capital is the biggest stakeholder of the company, with 8.9 million shares worth $434 million. 

Greenlight Capital made the following comment about Tenet Healthcare Corporation (NYSE:THC) in its Q4 2022 investor letter:

“Though we believe we are in the middle stages of a bear market, we did establish a new medium-sized long position in Tenet Healthcare Corporation (NYSE:THC) during the fourth quarter.

THC is an operator of hospitals and ambulatory surgery centers (ASC). In recent years, the company has grown and transitioned its business mix towards its higher-margin ASCs. This shift has enabled the company to generate significant, and what we believe to be sustainable, cash flows.

During 2022, the company lowered its guidance due to COVID and inflationary headwinds, resulting in its shares declining by more than 50% year-to-date through late October. We believe this pullback offered an attractive opportunity to participate in the company’s transformation, as we expect its ASC growth to remain strong and its now smaller hospital portfolio to improve from both a cost and volume perspective. We acquired our shares from late December through the beginning of January for an average price of $48.61, or 8.7x 2023 consensus earnings. THC recently announced and began its plan to repurchase about 20% of the outstanding shares by the end of 2024.”

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