Fundamentally, the case for strong buy healthcare stocks really sells itself. First off, let’s discuss the underlying sector. As I’ve started mentioning recently, wealth without health means nothing. You can reference many spiritual or religious aphorisms that basically state the same thing. Those who gain the entire world ultimately lose it anyways if they forfeit their soul.
In other words, the person who perishes with the most toys still perishes. So, fully enjoying the fruit of one’s labor requires having your senses. It’s just reality.
Now, add the element of Wall Street analysts’ strong buy ratings. We’re not just talking about a random expert pegging a security with a bullish assessment. No, instead the ideas mentioned below feature a consensus view of robust optimism. There’s strength and confidence in numbers – and that applies doubly when those numbers are backed by expert knowledge.
Keep in mind that consensus doesn’t guarantee anything. However, in a game of probabilities, these ideas are certainly compelling. With that, below are strong buy healthcare stocks to consider.
HCA Healthcare (HCA)
Based in Nashville, Tennessee, HCA Healthcare (NYSE:HCA) is a for-profit operator of healthcare facilities. Per its public profile, HCA owns and operates 186 hospitals and approximately 2,000 sites for various services, including surgery centers and freestanding emergency rooms. Analysts rate HCA stock as a consensus strong buy with a $356.71 average price target. Further, the high-side target runs up to $396.
Financially, what’s appealing about the enterprise is the valuation. Right now, shares trade hands at 16.98X trailing-year earnings and 16.5X forward earnings. Both stats are well below their respective median values of 23.48X and 25.58X. What’s more enticing, covering experts project business expansion in both the top and bottom lines.
For fiscal 2024, analysts forecast that earnings per share will rise nearly 12% top hit $20.89. On the top line, sales may expand by 7.3% to hit $69.74 billion. If that wasn’t enough, the most optimistic targets call for EPS of $21.74 on revenue of $70.42 billion.
Lastly, the company offers a forward yield of 0.78%. As a balanced idea, HCA makes a solid case for strong buy healthcare stocks.
Encompass Health (EHC)
Headquartered in Birmingham, Alabama, Encompass Health (NYSE:EHC) ranks among on the nation’s largest providers of post-acute healthcare services. It offers both facility-based and home-based post-acute services in 36 states and Puerto Rico through its vast network. Thanks to its underlying relevance, analysts peg EHC as a unanimous strong buy with a $97.17 average price target. The high-side estimate calls for $108 per share.
Financially, Encompass presents an enticing profile. During the trailing 12 months (TTM), the company posted net income of $386.5 million, translating to earnings of $3.82 per share. Revenue during the cycle hit $4.96 billion. What’s more, the present quarterly sales growth rate (year-over-year) stands at 13.4%.
For fiscal 2024, analysts believe that EPS may rise 12.9% to reach $4.11. On the top line, revenue may hit $5.31 billion, a 10.6% lift from last year’s result of $4.8 billion. In the following year, EPS may rise again to $4.60, while sales may see a solid boost to $5.79 billion.
It’s not the most generous idea for passive income. Nevertheless, Encompass offers a forward yield of 0.7%. For an entity that keeps on marching forward, EHC ranks among the strong buy healthcare stocks.
Cigna (CI)
Hailing from Bloomfield, Connecticut, Cigna (NYSE:CI) falls under the healthcare plans segment. With its subsidiaries, Cigna provides insurance and related products and services in the U.S. While the sector features many convoluted details, the reality is that the health insurance space is an incredibly important and relevant one. Therefore, it’s not surprising that analysts rate shares a consensus strong buy with a $395 average price target.
Financially, Cigna stands on steady ground and a robust jobs market could play into its hands. During the TTM period, its net income came in at $3.62 billion, translating to $12.19 per share. Revenue in the cycle hit $204.15 billion. Further, its current quarterly sales growth rate stands at 19.3%.
For fiscal 2024, analysts anticipate EPS to rise almost 14% to reach $28.52. On the top line, sales may see a 20.7% jump from last year’s print of $195.26 billion to hit $235.62 billion. Moreover, the blue-sky targets call for earnings of $28.75 per share on sales of $238.43 billion.
Notably, Cigna provides a decent forward yield for the sector at 1.67%. With that, CI ranks among the top strong buy healthcare stocks to consider.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.