The following are the top rated Healthcare stocks according to Validea’s Low PE Investor model based on the published strategy of John Neff. This strategy looks for firms with persistent earnings growth that trade at a discount relative to their earnings growth and dividend yield.
DEXCOM, INC. (DXCM) is a large-cap growth stock in the Medical Equipment & Supplies industry. The rating according to our strategy based on John Neff is 42% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: DexCom, Inc. is a medical device company. The Company is primarily focused on the design, development, and commercialization of continuous glucose monitoring (CGM), systems for use by people with diabetes and by healthcare providers. Its Dexcom G6 is a CGM system that can be used as part of an integrated system with other compatible medical devices and electronic interfaces, which may include automated insulin dosing systems, insulin pumps, blood glucose meters or other electronic devices used for diabetes management. Its Dexcom Share remote monitoring system, offered for use with its Dexcom system, uses an application on the patient’s mobile device to wirelessly transmit glucose information to the cloud and then to applications on the mobile devices of up to five designated recipients. Its Dexcom Real-Time API enables invited third-party developers to integrate real-time CGM data into their digital health applications and devices. Its other products include Dexcom ONE and Dexcom G7.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of DEXCOM, INC.
ENSIGN GROUP INC (ENSG) is a mid-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on John Neff is 42% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: The Ensign Group, Inc. is a holding company, which provides a range of skilled nursing and senior living services, physical, occupational and speech therapies, and other rehabilitative and healthcare services. The Company operates through two segments: skilled services and Standard Bearer. Th skilled services segment includes the operation of skilled nursing facilities and rehabilitation therapy services. The Standard Bearer segment consist of select properties owned by the Company through its real estate investment trust (REIT) and leased to skilled nursing and senior living operations, including its own operating subsidiaries and third-party operators. It provides its services at about 288 healthcare facilities in Arizona, California, Colorado, Idaho, Iowa, Kansas, Nebraska, Nevada, South Carolina, Texas, Utah, Washington and Wisconsin. It also acquires, leases and owns healthcare real estate to service the post-acute care continuum through acquisition and investment opportunities.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | FAIL |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | PASS |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of ENSIGN GROUP INC
ICON PLC (ICLR) is a large-cap growth stock in the Biotechnology & Drugs industry. The rating according to our strategy based on John Neff is 42% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: ICON Public Limited Company is a healthcare intelligence and clinical research organization. The Company is engaged in providing outsourced services to pharmaceutical, biotechnology, medical device and government and public health organizations. It offers a range of specialized services to assist pharmaceutical, biotechnology and medical device companies to bring new drugs and devices to market faster. The Company’s services include clinical research services, commercial positioning, consulting, early phase, strategic solutions, laboratories, language services, medical imaging, real world intelligence, site and patient solutions, COVID-19 clinical operation and decentralized and hybrid clinical solutions. It also provides its full range of clinical, consulting and commercial services across several sectors. Its sectors include Biosimilars, Biotech, Government and public health solutions, medical devices, pharmaceuticals and the IVDR journey.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of ICON PLC
DR REDDY’S LABORATORIES LTD (ADR) (RDY) is a mid-cap growth stock in the Biotechnology & Drugs industry. The rating according to our strategy based on John Neff is 42% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Dr. Reddy’s Laboratories Limited is an India-based pharmaceutical company. The Company’s segments include Global Generics, which is engaged in manufacturing and marketing prescription and over-the-counter finished pharmaceutical products ready for consumption by the patient, marketed under a brand name (branded formulations) or as generic finished dosages with therapeutic equivalence to branded formulations (generics); Pharmaceutical Services and Active Ingredients (PSAI), which is engaged in manufacturing and marketing active pharmaceutical ingredients and intermediates for finished pharmaceutical products; Proprietary Products, which focuses on research and development of differentiated formulations and Others, which consists of the Company’s wholly-owned subsidiary, Aurigene Discovery Technologies Limited, which is a discovery stage biotechnology company developing novel and therapies in the fields of oncology and inflammation.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of DR REDDY’S LABORATORIES LTD (ADR)
ADDUS HOMECARE CORPORATION (ADUS) is a small-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on John Neff is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Addus HomeCare Corporation is engaged in providing home care and support services. Its segments include personal care, hospice, and home health. The personal care segment provides non-medical assistance with activities of daily living, primarily to persons who are at the risk of hospitalization or institutionalization, such as the elderly, chronically ill or disabled. Its services include assistance with bathing, grooming, oral care, feeding and dressing, medication reminders, and meal planning and preparation. The hospice segment provides physical, emotional, and spiritual care for people who are ill as well as related services for their families. Its hospice services include palliative nursing care, social work, spiritual counseling, homemaker services, and bereavement counseling. The home health segment provides services to individuals who require assistance during an illness or after hospitalization and includes skilled nursing and physical, occupational and speech therapy.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of ADDUS HOMECARE CORPORATION
BALCHEM CORP (BCPC) is a mid-cap growth stock in the Biotechnology & Drugs industry. The rating according to our strategy based on John Neff is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Balchem Corporation develops, manufactures, distributes and markets specialty performance ingredients and products for the nutritional, food, pharmaceutical, animal health, medical device sterilization, plant nutrition and industrial markets. The Company’s segments include Human Nutrition and Health (HNH), Animal Nutrition and Health (ANH), and Specialty Products. The HNH segment provides human grade choline nutrients and mineral amino acid chelated products for nutrition and health applications. This segment also serves the food and beverage industry for beverage, bakery, dairy, confectionary, and savory manufacturers. The ANH segment provides nutritional products derived from its microencapsulation and chelation technologies, in addition to nutrient choline chloride. Through Specialty Products, it provides specialty-packaged chemicals for use in healthcare and other industries, and also provides chelated minerals to the micronutrient agricultural market.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | PASS |
| FUTURE EPS GROWTH: | FAIL |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of BALCHEM CORP
ENCOMPASS HEALTH CORP (EHC) is a mid-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on John Neff is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Encompass Health Corporation is a provider of post-acute healthcare services. The Company manages its operations through its inpatient rehabilitation segment. It is an owner and operator of inpatient rehabilitation hospitals. The Company has a national network of inpatient rehabilitation hospitals stretches across 35 states and Puerto Rico, with a concentration of hospitals in the eastern half of the United States and Texas. It provide specialized rehabilitative treatment on both an inpatient and outpatient basis. Its advanced therapies include physical therapy, occupational therapy and speech therapy. The Company offers rehabilitative care to patients and the ones recovering from conditions, such as stroke and other neurological disorders, cardiac and pulmonary conditions, brain and spinal cord injuries, complex orthopedic conditions, and amputations.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of ENCOMPASS HEALTH CORP
INCYTE CORPORATION (INCY) is a large-cap growth stock in the Biotechnology & Drugs industry. The rating according to our strategy based on John Neff is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Incyte Corporation is a biopharmaceutical company, which is focused on the discovery, development, and commercialization of therapeutics. The Company also conducts commercial and clinical development operations from its European headquarters in Morges, Switzerland, and Japanese office in Tokyo and Canadian headquarters in Montreal. It operates in two therapeutic areas, One therapeutic area is Hematology/Oncology, which is comprised of Myeloproliferative Neoplasms and Graft-Versus-Host Disease, as well as solid tumors and hematologic malignancies. The other therapeutic area is Inflammation and Autoimmunity, which includes its Dermatology commercial franchise. Its hematology and oncology franchise are comprised of four products, which are JAKAFI (ruxolitinib), MONJUVI (tafasitamab-cxix)/MINJUVI (tafasitamab), PEMAZYRE (pemigatinib) and ICLUSIG (ponatinib), as well as other clinical development programs. Its Dermatology commercial franchise is comprised of OPZELURA (ruxolitinib) cream.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of INCYTE CORPORATION
PREMIER INC (PINC) is a mid-cap growth stock in the Medical Equipment & Supplies industry. The rating according to our strategy based on John Neff is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Premier, Inc. is a healthcare improvement company uniting an alliance of approximately 4,400 United States hospitals and health systems and approximately 225,000 other providers and organizations. It operates through two segments: Supply Chain Services and Performance Services. The Supply Chain Services segment includes the Company’s group purchasing organizations (GPO), supply chain co-management, purchased services, and direct sourcing activities. The Performance Services segment consists of three sub-brands, which include PINC AI, the Company’s technology and services platform; Contigo Health, the Company’s direct-to-employer business; and Remitra, the Company’s digital invoicing and payables business. It delivers technology-enabled platform that offers critical supply chain services, clinical, financial, operational and value-based care software as a service (SaaS) as well as clinical and enterprise analytics licenses, consulting services, and third-party administrator services
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of PREMIER INC
STEVANATO GROUP SPA (STVN) is a mid-cap growth stock in the Medical Equipment & Supplies industry. The rating according to our strategy based on John Neff is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Stevanato Group SpA is an Italy-based manufacturer and distributor engaged in two segments: Biopharmaceutical and Diagnostic Solutions and Engineering, including the production and distribution of drug containment solutions, drug delivery systems, and diagnostic solutions in the pharmaceutical industry. The Company delivers products, processes, and services across all stages of drug developments, including pre-clinical, clinical, and commercialization. Its Engineering segment includes the equipment and technologies developed and provided to support the end-to-end pharmaceutical, biotechnology, and diagnostic manufacturing processes. The Company operates locally, in Europe, and globally, including Brazil, China, Mexico, and the United States.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | PASS |
| FUTURE EPS GROWTH: | FAIL |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | FAIL |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of STEVANATO GROUP SPA
About John Neff: While known as the manager with whom many top managers entrusted their own money, Neff was far from the smooth-talking, high-profile Wall Streeter you might expect. He was mild-mannered and low-key, and the same might be said of the Windsor Fund that he managed for more than three decades. In fact, Neff himself described the fund as “relatively prosaic, dull, [and] conservative.” There was nothing dull about his results, however. From 1964 to 1995, Neff guided Windsor to a 13.7 percent average annual return, easily outpacing the S&P 500’s 10.6 percent return during that time. That 3.1 percentage point difference is huge over time — a $10,000 investment in Windsor (with dividends reinvested) at the start of Neff’s tenure would have ended up as more than $564,000 by the time he retired, more than twice what the same investment in the S&P would have yielded (about $233,000). Considering the length of his tenure, that track record may be the best ever for a manager of such a large fund.
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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