10 Healthcare Stocks With Strong Growth For 2014: Investment Idea Of The Day


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The U.S. healthcare sector has continued its growth momentum into 2014 after registering a robust growth of 39% during 2013 on the back of higher M&A activities, new drug launches and increasing healthcare spending. The Affordable Care Act is also expected to benefit the sector as the number of insured Americans across the country will grow. The S&P healthcare sector index increased 1% during January 2014 compared to a 3.6% decline in the broader index. The sector index has surged over 5% year-to-date. According to a NASDAQ article, earnings of the healthcare sector have outperformed other sectors in the S&P 500 during the fourth quarter 2013 with approximately 86% of healthcare companies reporting above consensus estimates.


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Ubika Research has picked ten healthcare stocks which are expected to register strong growth in 2014 and are likely to outperform their peers and broader markets. These stocks have registered strong growth in sales and EPS in the trailing twelve months period and are estimated to report strong growth in sales and EPS in 2014. Moreover, majority of these stocks are currently trading at lower forward PE multiple compared with the industry average and are estimated to provide strong return on equity (ROE) in 2014. During the past three months, majority of the shortlisted stocks have accumulated gains with daily average traded volume in excess of 100,000.

Company Name

Exchange

Ticker

Market Cap
($ BN)

Last Price

Average Volume
(3-Months)

Price Change
(1-Months)

TTM Sales Growth

Sales Growth
(2014E)

TTM EPS Growth

EPS Growth
(2014E)

1Yr- Forward PE

Return on Equity
(2014E)

Questcor Pharmaceuticals Inc

NASDAQ

QCOR

4.6

75.83

2,021,827

24.3%

68.9%

57.1%

64.9%

55.2%

14.7

82.1%

HealthSouth Corp

NYSE

HLS

2.9

33.32

562,125

-2.3%

6.3%

5.5%

80.2%

10.8%

17.6

65.6%

Myriad Genetics Inc

NASDAQ

MYGN

2.6

35.03

2,501,843

27.0%

35.2%

22.6%

59.6%

22.8%

16.1

21.1%

Charles River Laboratories International Inc

NYSE

CRL

2.8

58.13

507,618

13.4%

3.2%

4.0%

6.0%

4.9%

18.9

18.7%

Mindray Medical International Ltd

NYSE

MR

4.2

35.00

1,065,847

-9.4%

15.2%

14.4%

17.9%

11.2%

17.8

16.3%

Bio-Reference Labs Inc

NASDAQ

BRLI

0.8

27.38

423,801

-23.6%

16.5%

10.0%

10.0%

7.5%

15.4

15.6%

Sirona Dental Systems Inc

NASDAQ

SIRO

3.9

69.80

797,843

-3.1%

13.5%

6.4%

14.8%

7.0%

19.1

14.8%

Patterson Cos Inc

NASDAQ

PDCO

4.2

39.98

727,335

-6.8%

4.8%

12.0%

1.5%

6.5%

18.5

13.4%

Molina Healthcare Inc

MYSE

MOH

1.7

36.24

608,770

15.0%

10.3%

51.2%

465.0%

104.5%

18.5

10.3%

Amsurg Corp

NASDAQ

AMSG

1.4

42.31

150,416

-5.6%

14.7%

16.2%

16.5%

11.4%

19.2

7.9%

Source: Bloomberg
TTM: Trailing Twelve Months

Company Description:

Questcor Pharmaceuticals Inc (NASDAQ: QCOR)      
Questcor Pharmaceuticals, Inc. develops and commercializes novel central nervous system-focused therapeutics that address significant unmet medical needs. The company's primary product is a natural source adrenocorticotropic hormone indicated for the treatment of acute exacerbations of multiple sclerosis, as well as a number of other conditions.

HealthSouth Corp (NYSE: HLS)         
HealthSouth Corporation provides inpatient rehabilitative healthcare services. The company operates inpatient rehabilitation hospitals, outpatient and rehabilitation satellites, and home health agencies. HEALTHSOUTH provides treatment on both an inpatient and outpatient basis.

Myriad Genetics Inc (NASDAQ: MYGN)          
Myriad Genetics, Inc. develops and markets molecular diagnostic products to provide physicians with information to help guide the care of their patients, to prevent disease, delay the onset of disease, or catch disease at an early stage.

Charles River Laboratories International Inc (NYSE: CRL)     
Charles River Laboratories International, Inc. provides research tools and support services that enable drug discovery and development. The company provides the animal research models required in research and development for new drugs, devices, and therapies.  Charles River's customers include pharmaceutical and biotechnology companies, hospitals, and academic institutions.

Mindray Medical International Ltd (NYSE: MR)          
Mindray Medical International Limited develops, manufactures, and markets medical devices. The company offers patient monitoring devices, diagnostic laboratory instruments, and ultrasound imaging systems.

Bio-Reference Labs Inc (NASDAQ: BRLI)       
Bio-Reference Laboratories, Inc. operates an independent clinical laboratory in the Northeast United States. The company's laboratory has specialty capability in the areas of genomics, oncology, correctional health, and complementary medicine.  Bio-Reference also offers information solutions for reducing healthcare costs and improving quality performance.

Sirona Dental Systems Inc (NASDAQ: SIRO) 
Sirona Dental Systems, Inc. develops, manufactures, and markets a complete line of dental equipment. he company's products include CAD/CAM restoration equipment (CEREC), digital and film-based intra-oral, panoramic and cephalometric X-ray imaging systems, dental treatment centers and hand pieces.

Patterson Cos Inc (NASDAQ: PDCO)  
Patterson Companies Inc. distributes dental products, veterinary supplies for companion pets, and rehabilitation supplies. The company sells and markets to dental clinics and laboratories, veterinarians, and to the physical and occupational therapy markets.

Molina Healthcare Inc (MYSE: MOH)  
Molina Healthcare Inc. is a managed care organization. The company arranges for the delivery of health care services to persons eligible for Medicaid and other programs for low-income families and individuals.  Molina Healthcare has health plans in California, Washington, Utah, and Michigan, as well as primary care clinics located in Northern and Southern California.

Amsurg Corp (NASDAQ: AMSG)        
AmSurg Corporation develops, acquires, and manages physician practice-based ambulatory surgery centers and specialty physician networks. The company operates in partnership with surgical and other group physician practices.

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