The healthcare industry has traditionally been a safe place for investors to put their cash. However, the healthcare industry also comes with some rather unsafe players. Today, I’m going to go over some of the more popular choices to see which are worth the investment on the TSX today.
Bellus Health Stock
One healthcare stock that’s been coming to headlines is Bellus Health (TSX:BLU) after British drug giant GSK stated it would be buying the company for US$2 billion. The purchase comes in at US$14.75 per share, with is currently on par with where Bellus stock trades at the moment.
However, at the time it led to a surge in share price of about 109%. Since then, however, share prices have remained stable. GSK management have since stated that the company would look to turn around the company’s cough drug by 2026 and be “rapidly adopted.” This could lead to earnings in 2027 with billions in sales each year.
The deal is due to close in the third quarter of 2023 or even earlier. Therefore, should shares fall below the US$14.75 price, it might be a good time to jump in. However, if it remains at these levels, analysts suggest holding off.
Bausch Health Companies
Bausch Health Companies (TSX:BHC) is another healthcare company investors have their eyes on. That’s especially after the company produced better-than-expected fourth-quarter results back in February. It also increased its 2023 guidance, leading to an upswing, despite an operating loss.
Bausch stock brought in US$2.2 billion in total revenue, which was above forecasts but in line with last quarter’s results. That being said, adjusted earnings before interest, taxes, depreciation, and amortization missed estimates by more than 10% in some cases.
The problem here is that while the company continues to stand behind its decisions to separate Bausch Health stock from Bausch + Lomb, there are details missing as to when investors should see a turnaround in operating loss. Further, a pending court decision is still on the table for the stock as well. So, with shares still down 52% in the last year, it might be best to sit on the sidelines for now.
WELL Health stock
A company that continues to corner and expand in the market of telehealth is WELL Health Technologies (TSX:WELL), with shares up 34% in the last year, and earnings due around the corner. The question is, is it still a buy at these higher levels?
In the view of analysts, yes, it certainly is. WELL Health stock is bound to continue making gains, especially for long-term holders. This mainly comes down to the fact that we continue to see the healthcare system as overworked. We need more and more support across the board. This allows telehealth to come in and help with that support.
Furthermore, WELL Health stock has already made a name for itself in digital healthcare as well, supporting digital filing systems and offering cybersecurity of data. So, while shares are priced higher than they were six months ago, there are still gains to come. In fact, to reach its consensus price target by analysts, there could be another 49% to go, as of writing, for WELL Health stock.