Got $4,000? 4 Healthcare Stocks to Buy and Hold Forever

These healthcare stocks may not sound exciting, but the future growth opportunities certainly are.

Investing in the healthcare sector offers a unique blend of stability and growth potential. If you’re considering allocating $4,000 into healthcare stocks with strong market capitalizations on the TSX, here are four noteworthy companies to consider first. They are Andlauer Healthcare Group (TSX: AND), Knight Therapeutics (TSX: GUD), WELL Health Technologies (TSX: WELL), and Cipher Pharmaceuticals (TSX: CPH).

Stethoscope with dollar shaped cord

Source: Getty Images

Andlauer

Andlauer Healthcare Group specializes in healthcare logistics and transportation, ensuring that medical products reach their destinations safely and efficiently. As of writing, Andlauer’s market capitalization stands at approximately $1.2 billion. In its 2024 financial results, the healthcare stock reported annual revenue totalling $650.5 million, a slight increase from $648 million in 2023.

Operating income was $94 million, compared to $97.3 million in the previous year. Net income for 2024 was $66.4 million, or $1.57 per diluted share, slightly down from $68.4 million, or $1.62 per diluted share, in 2023. Despite these modest declines, Andlauer’s consistent performance underscores its pivotal role in the healthcare supply chain, thereby making it a compelling choice for long-term investors.

Knight Therapeutics

Knight Therapeutics focuses on acquiring or in-licensing innovative pharmaceutical products for the Canadian and select international markets. Based in Montreal, Knight has established a strong presence in the specialty pharmaceutical landscape. In its 2024 financial results, the healthcare stock reported revenues of $371.3 million, an increase of 13% over the prior year.

This growth was driven by the expansion of key promoted products and the impact of hyperinflation in Argentina, partly offset by declines in mature products and currency depreciation in select Latin American countries. The gross margin remained steady at 47% of revenues, totalling $174.4 million. Operating income was $7.4 million, a significant improvement from an operating loss of $2.9 million in the previous year. Net income reached $4.3 million, or $0.04 per share, compared to a net loss of $16.8 million, or a loss per share of $0.16, in the prior year. These positive trends highlight Knight Therapeutics’ effective growth strategy and operational efficiency.

WELL Health

WELL Health is a digital health company that owns and operates primary healthcare facilities in Canada and the United States. It also provides software-as-a-service (SaaS) electronic medical records (EMR) services to clinics and doctors across Canada.

As of writing, WELL Health’s market capitalization is approximately $1.2 billion. In its most recent financial report, the healthcare stock reported revenues of $569 million for 2022, reflecting its rapid expansion and the growing demand for digital health solutions. WELL Health’s commitment to integrating technology with healthcare services has positioned it as a leader in the telemedicine space. Analysts have maintained a ‘Buy’ rating on the stock, with a price target consensus of $8.10, representing a potential upside of 17.7% at writing.

Cipher Pharmaceuticals

Cipher Pharmaceuticals is a specialty pharmaceutical company with a focus on dermatology. It acquires and in-licenses novel drug products for commercialization in Canada and the United States. As of writing, Cipher’s stock was trading at $13.49, with a market capitalization of approximately $344.5 million.

In its fourth quarter and full-year 2024 results, Cipher reported total revenue of US$33.4 million, a 58% increase compared to 2023. The healthcare stock’s gross profit for 2024 was US$24.1 million, up from US$17.1 million in the previous year. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the year was US$15.7 million, reflecting a 23% increase over 2023.

Notably, Cipher generated US$8.3 million in cash during the fourth quarter of 2024, underscoring its strong financial performance. The company’s strategic focus on niche markets and its robust product pipeline make it an attractive option for investors seeking exposure to the healthcare sector.

Foolish takeaway

Investing in healthcare stocks requires a long-term perspective, as the sector can be influenced by regulatory changes, technological advancements, and demographic shifts. However, the essential nature of healthcare services often provides a level of stability not found in other industries. Companies like Andlauer Healthcare Group, Knight Therapeutics, WELL Health Technologies, and Cipher Pharmaceuticals have demonstrated resilience and adaptability, positioning them well for future growth.

Altogether, allocating $4,000 into these four healthcare stocks on the TSX offers a balanced approach to investing in a sector that combines stability with growth potential. Each company presents unique opportunities, and with careful consideration, could be valuable additions to a long-term investment portfolio.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Andlauer Healthcare Group and Cipher Pharmaceuticals. The Motley Fool has a disclosure policy.

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