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The Best Stocks I Don't Own:  Health Care

Let's continue this series of the best stocks I don't own with a look at the health care sector.  I already own several top notch health care stocks, but I'm open to considering another if something looks compelling.


I compiled all the Champions and Contenders from the CCC list created by David Fish and currently maintained by Justin Law. You can find Justin's article on the CCC list's most recent update here. (I decided not to include Challengers in this analysis in order to focus on the more established dividend growth stocks.)

I then sorted the compiled Champions and Contenders by Sector (column C on the list) and retained only a few pieces of information for each company -- ticker, company name, number of years the company has raised the dividend, 1-year DGR, and 5-year DGR. I added columns for Value Line's safety and financial strength ratings, S&P credit rating, and Morningstar moat and stewardship ratings, and then populated the table. Finally, I sorted the list to show the companies with the highest Value Line financial strength rating first, and further sorted by S&P credit rating.

Health Care:  the Best of the Champions and Contenders

The results are below, with my own holdings above the double line and the rest of the results following.  (The two entries in italics, ABT and CVS, are part of my portfolio but don't qualify for this analysis; neither is a Champion or Contender.)  One thing I should point out:  the stock CHE isn't strictly just a health care company.  It's an unusual combination of Vitas Healthcare, a hospice and palliative care company; and Roto Rooter, the well known plumbing company.

Something that immediately caught my eye is the fact that unlike consumer staples, there are many health care stocks rated A++ for financial strength. Overall I'm satisfied with my health care holdings, but based on this list, I might like to give PFE and UNH a closer look.