People paid little attention to medical care until the coronavirus breakout in 2020. The global pandemic disrupted healthcare services and heightened investors’ awareness in the sector. Fast-forward to the present, three healthcare stocks are among the no-brainer buys.
You can make money from Extendicare (TSX: EXE), Medical Facilities (TSX: DR), and Healwell AI (TSX: AIDX) with as little as $500. All three are outperforming and have market-beating returns thus far at the end of Q3 2024. Their upward momentum is unstoppable, and potential gains could soar through the roof.
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Long-term stability
Senior housing and care for older people is a growing sector in Canada. Extendicare is a fixture in retirement residences and a reliable passive income source. At $9.34 per share, current investors enjoy a 33.9% year-to-date gain and partake in the 5.1% dividend yield (monthly payout).
The business took a hit during the health crisis but has since recovered remarkably. This $776.2 million company provides quality care and services for Canadian seniors. Extendicare ended Q2 2024 with a strong balance sheet and liquidity position.
Its President and CEO, Dr. Michael Guerriere, said Extendicare has returned to long-term stability, evidenced by improved operating margins and higher funding for long-term care (LTC) and home health care. He adds that underlying demographic trends support continued growth across all business lines and management’s LTC redevelopment agenda.
Unique business model
Medical Facilities owns surgical facilities in the United States consisting of four specialty surgical hospitals and one ambulatory surgery centre. At $14.83 per share, the year-to-date gain is 68.7%. This small-cap stock pays a decent 2.5% dividend.
This $356.4 million company has a unique business model that covers all stakeholders. All facilities ensure the highest-quality treatment and boast amenities to enhance patient care. Medical Facilities partners with or makes physicians co-owners (114 physician partners) and allows non-owner physicians to practice.
Management aims to increase operating cash flows to the quarterly dividend and deliver stable income to investors.
In June this year, Medical Facilities announced plans to expand its services and offer heart and vascular care through Black Hills Surgical Hospital. A state-of-the-art cardiac catheterization laboratory will be constructed for advanced cardiac and coronary procedures.
Like Extendicare, Medical Facilities will benefit from the growing demand for healthcare, the aging population, and overall population growth.
Healthcare technology
Technological advances are also happening in healthcare, with physicians at the helm. Healwell AI, a $217.4 million healthcare technology company, focuses on and uses artificial intelligence (AI) and data science for preventative care and early disease detection.
This healthcare stock flew high amid a high-interest rate environment and is ,still rising. At only $1.33, the year-to-date gain is 77.3%. Had you invested $500 at year-end 2023, your money would be $886.67 today. Market analysts recommend a ‘strong buy’ rating. Their 12-month average price forecast is $3.68, a 177% upside.
Healwell is on the road to profitability following the record $544 million in revenue in Q2 2024. “Our robust acquisition pipeline, coupled with our strong cash position, strategically positions us for substantial growth ahead,” said its CEO, Dr. Alexander Dobranowski.
Top-of-mind choices
Healthcare stocks are now top-of-mind choices of growth investors. The healthcare industry will continue to make strides supported by non-traditional business models and new technologies.
