It may not seem like it, but Healthcare is among the most diverse sectors in Canada right now. From cannabis stocks and conventional pharmaceutical companies to tech-oriented healthcare businesses, there is ample variety within the sector. There is also significant independence among different healthcare industries, which leads to inconsistent and unpredictable sector-wide performance.
One problem this leads to is that you can’t run an apples-to-apples comparison on stocks hailing from two different healthcare industries. Each has to be evaluated in the context of its challenges and opportunities.
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A healthcare technology company
WELL Health Technologies (TSX: WELL) is a healthcare technology company that serves healthcare providers through various virtual healthcare services and patients through its omnichannel patient services. This allows the company to stay connected to both ends of the transaction and opens pathways to a massive range of new business opportunities. It’s growing its healthcare services to providers and supporting the ecosystems of healthcare apps.
The company is also rapidly increasing the number of providers working directly under the WELL Health banner, which currently stands above 4,000 in the U.S. and Canada.
WELL Health is already a promising prospect, though its financials have yet to prove it. The company is growing on multiple fronts, and as a mature provider of a range of virtual services, it also has the early bird advantage. The market sentiment around the company grew significantly positive during the pandemic, and it grew by over 550% in less than a year. It has experienced bullish surges since then as well, but nothing has come close. Still, the stock looks promising for the long term.
A pharmaceutical company
Saying that Bausch Health Companies (TSX: BHC) “fell from grace” would be an understatement. It was once one of the most valuable companies in the country, and some regulatory troubles pushed it over the edge about 96% at one point. It has been struggling since then.
The stock is currently heavily discounted, not just from its all-time high but also from its five-year peak. The 78% discount would make it a decent pick if there is a strong chance of the stock making a recovery. It’s trading at $9 per share right now, and if it can go even halfway to its five-year peak, the stock can double your capital.
But the question is, will it? The company recently announced that it’s not going private, causing the stock to slump further. The bear market phase of just 2025 has pushed it down 20%. The chances of the stock recovering from that without a solid positive market sentiment catalyst are pretty low.
Foolish takeaway
While both healthcare stocks are discounted right now, WELL Health modestly and Bausch Health brutally, the former looks more promising in the long term. Bausch Health might offer significant returns in the short term if the company releases some positive news, but it’s a volatile investment overall.
