If you have a budget of $1,500, consider investing in these three healthcare stocks for a long-term investment:
Investing in healthcare stocks can be a smart move, especially with the sector's projected growth due to aging populations worldwide. If you only have $1,500 to invest, here are three healthcare stocks that you might want to consider buying and holding forever.
1. AbbVie
AbbVie, with its ticker symbol ABBV, is a pharmaceutical powerhouse known for navigating patent cliffs effectively. When Abbott Labs spun off AbbVie in 2013, its cash cow was Humira, the top-selling medication for autoimmune diseases. While other drugmakers might have struggled when Humira faced patent expirations, AbbVie prepared for the challenge. It invested in research and development and made strategic acquisitions. By the time Humira's patent protection expired in the U.S. in 2023, AbbVie had significantly reduced its reliance on the drug, with two successor drugs, Rinvoq and Skyrizi, already in the market and generating strong sales.
Investing in AbbVie means getting a forward dividend yield of 3.8%, making it an attractive option for income-focused investors. Plus, AbbVie is a Dividend King, having increased its dividends for 52 consecutive years. At around $173 per share, your investment will start generating returns quickly.
2. Intuitive Surgical
Intuitive Surgical, represented by the ticker ISRG, could be another smart choice, especially if you're focused on growth. In 2000, the company launched its da Vinci robotic surgical system, which has since dominated the robotic surgical market. Around 84% of Intuitive Surgical's revenue is recurring, mainly from replacement instruments for its da Vinci systems, indicating high durability and growth potential. Intuitive Surgical targets around 22 million annual soft tissue procedures, which is currently less than 35% of procedures for which it already has products and clearances.
Despite a high forward earnings multiple (76), Intuitive Surgical's robust growth prospects and market dominance justify its premium valuation.
3. Vertex Pharmaceuticals
Finally, if you're looking for a high-growth biotech stock, consider Vertex Pharmaceuticals (VRTX). The company commands a near-monopoly in treating the underlying cause of cystic fibrosis, a rare genetic disorder. Vertex recently received FDA approval for Alyftrek, its most powerful CF therapy yet, and has several other potential blockbusters in its pipeline. Although it primarily focuses on R&D and growth rather than dividends, Vertex's performance in the cystic fibrosis market and its ability to leverage success in one area to expand into others make it a strong investment option.
In conclusion, investing in any of these $1,500-friendly healthcare stocks could lead to substantial long-term benefits. AbbVie offers a strong growth strategy and a lucrative dividend yield, while Intuitive Surgical shows consistent double-digit growth. Vertex Pharmaceuticals boasts a robust pipeline and market positioning, particularly in cystic fibrosis.
Remember, your stock choice should be based on your investment strategy, risk tolerance, and long-term financial goals.
If you're interested in diversifying your portfolio, investing some of your money in different financial instruments can be beneficial. For instance, you might consider allocating a portion of your $1,500 to the financial market.
Investing in these healthcare stocks, such as AbbVie, Intuitive Surgical, and Vertex Pharmaceuticals, could yield promising returns in the long term. These companies have solid performance histories and growth prospects, making them attractive investment options.