IHE: Significant Growth Ahead, But Valuation Not Cheap (Rating Downgrade)

Ploutos Investing
7.05K Followers
(6min)

Summary

  • IHE invests in large-cap U.S. pharmaceutical stocks with solid long-term growth outlook but high concentration risk.
  • IHE's fund price has been steady with a positive trend in 2024, but its elevated valuation may not make it a good buy currently.
  • Despite being a defensive play in an economic recession, IHE can still experience significant declines due to market sentiment.

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Introduction

We wrote an article on iShares U.S. Pharmaceuticals ETF (NYSEARCA:IHE) back in January 2020 before the COVID-19 outbreak. In that article, we noted IHE's favorable long-term industry fundamentals and its fair valuation. It

This article was written by

7.05K Followers
I am a value focused investor. Stocks rise and fall for many different reasons that we often cannot predict. Eventually, it is those companies with a wide moat and the ability to generate cash flow that prevail. Therefore, my investment focus is to find value stocks that are able to generate cash flow, with sustainable dividends and provide growth over time. I focus my attention on analyzing large-capped dividend growth stocks, REITs and ETFs. I aim at providing a quarterly update and insights on stocks I follow. Please feel free to browse the articles that I wrote and provide any comments.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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