The aging baby-boomer demographic is a trend many investors are aware of, but not everyone knows how to cash in on it. Healthcare companies, with strong growth due to even stronger earnings, is one way to invest in the changing population model. Today we focused on healthcare companies of this nature, and we think you'll find our list rather interesting.
Interested in gaining exposure to healthcare companies? Looking for ways to dig deeper into a company's profitability? Do you prefer stocks with high projected earnings over the next year? For ideas on where to look, we ran a screen you may be interested in.
Return on Assets [ROA] illustrates how much a company is generating in earnings from its assets alone. This metric gives investors a picture of how profitable the company is relative to the assets in current possession. As well, it lets investors see how efficient and effective management is at generating earnings from the company's assets. While most management teams can probably make money by throwing money at an issue very few can make very large profits with little investment.
Return on Equity [ROE] is one way to identify great potential names relative to profitability. This ratio illustrates the percentage return on shareholder equity. As well, this metric segments the company into operational efficiency, asset use efficiency, and financial leverage. Why does this matter? Simply put, it allows investors to get a real picture of how the company is generating these returns and helps identify parts of the company that may be underperforming.
EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-Year Expected EPS Growth Rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.
We first looked for healthcare stocks. We then looked for businesses with strong profitability (ROA > 10%)(ROE [TTM]>30%). We then looked for companies with projected high growth, measured by 1-year projected EPS growth above 25%. We did not screen out any market caps.
Do you think these stocks offer both value and growth? Use our list to help with your own analysis.
POZEN Inc. (POZN)
|Industry:||Drug Manufacturers - Other|
POZEN Inc. has a Return on Assets of 47.90%, a Return on Equity of 51.73% and 1-Year Projected Earnings Per Share Growth Rate of 107.80%. The short interest was 19.36% as of 06/05/2012. POZEN Inc., a pharmaceutical company, develops products for the treatment of acute and chronic pain, and other pain-related conditions in the United States. Its products include Treximet for acute treatment of migraine attacks with or without aura in adults; and VIMOVO for the relief of the signs and symptoms of osteoarthritis, rheumatoid arthritis, and ankylosing spondylitis, as well as to decrease the risk of developing gastric ulcers in patients at risk of developing non-steroidal anti-inflammatory drugs -associated gastric ulcers. The company also develops PA32540, a product candidate, which is under 2 pivotal Phase 3 trials for the secondary prevention of cardiovascular disease in patients at risk for gastric ulcers.
Akorn, Inc. (AKRX)
|Industry:||Drugs - Generic|
Akorn, Inc. has a Return on Assets of 20.58%; Return on Equity of 34.73%; and 1-Year Projected Earnings Per Share Growth Rate of 25.93%. The short interest was 14.76% as of 06/05/2012. Akorn, Inc. engages in the manufacture and marketing of diagnostic and therapeutic ophthalmic pharmaceuticals products, niche hospital drugs, and injectable pharmaceuticals in the United States and internationally. It offers products in various specialty areas, including ophthalmology, antidotes, anti-infectives, pain management, anesthesia, and vaccines. The company's Ophthalmic segment markets diagnostic products, including mydriatics and cycloplegics, anesthetics, topical stains, gonioscopic solutions, angiography dyes, and others primarily for use in the office setting.
Progenics Pharmaceuticals Inc. (PGNX)
Progenics Pharmaceuticals Inc. has a Return on Assets of 24.11%; Return on Equity of 43.69%; and 1-Year Projected Earnings Per Share Growth Rate of 369.20%. The short interest was 4.65% as of 06/05/2012. Progenics Pharmaceuticals, Inc., a biopharmaceutical company, engages in the development and commercialization of therapeutic products to treat the unmet medical needs of patients with debilitating conditions and life-threatening diseases in the United States and internationally. Its primary programs focus on gastroenterology, oncology, and virology. The company offers RELISTOR (methylnaltrexone bromide) subcutaneous injection, a therapy for opioid-induced constipation.
SIGA Technologies, Inc. (SIGA)
SIGA Technologies, Inc. has a Return on Assets of 25.51%; Return on Equity of 57.76%; and 1-Year Projected Earnings Per Share Growth Rate of 657.90%. The short interest was 20.40% as of 06/05/2012. SIGA Technologies, Inc., a pharmaceutical company, engages in the development and commercialization of pharmaceutical solutions for smallpox, Ebola, dengue, Lassa fever, and other dangerous viruses. Its lead product is ST-246, an orally administered antiviral drug that targets orthopoxviruses. The company also has two drug series in the pre-clinical development stage against four serotypes of virus for dengue disease.
Questcor Pharmaceuticals, Inc. (QCOR)
Questcor Pharmaceuticals, Inc. has a Return on Assets of 46.09%; Return on Equity of 59.92%; and 1-Year Projected Earnings Per Share Growth Rate of 36.21%. The short interest was 25.46% as of 06/05/2012. Questcor Pharmaceuticals, Inc., a biopharmaceutical company, provides prescription drugs for the treatment of multiple sclerosis, nephrotic syndrome, and infantile spasms indications. It primarily offers H.P.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz and Google Finance.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.