11 Cheap Healthcare Stocks To Invest In
Wed, October 5, 2022, 3:25 PM
In this article, we discuss the 11 cheap healthcare stocks to invest in. If you want to skip the detailed analysis of the healthcare industry.
Philips staat op #10
10. Koninklijke Philips N.V. (NYSE:PHG)
Price as of October 3: $15.51
Koninklijke Philips N.V. (NYSE:PHG) is a Dutch medical devices company. It operates through three segments; diagnosis and treatment, connected care, and personal health.
Koninklijke Philips N.V. (NYSE:PHG) is one of the best healthcare stocks because of its strong focus on shareholder returns. The company pays dividends annually and as of October 3, the company has a yield of 5.88%. The next estimated dividend payout date is June 9, 2023. However, it has to be kept in mind that the Netherlands has a dividend withholding tax of 15% which lowers the dividend yield due to the dilution of shares as the shareholders prefer their dividends in form of shares rather than cash. Nonetheless, the company consistently repurchases its outstanding shares and has spent $5 billion on share repurchases since 2017.
Koninklijke Philips N.V. (NYSE:PHG) is also a good addition to investor portfolios as it has penetrated a market with obstructed entrance. The company has only two other competitors and has steady subscription services for some of its products, generating some strong recurring revenues for the company.
On September 12, Societe Generale analyst Delphine Le Louet upgraded Koninklijke Philips N.V. (NYSE:PHG) shares to Buy from Hold and lowered the price target to EUR 21 from EUR 22.40. The analyst believes that the company’s current share price “more than discounts the bad news.”
Here is what Artisan Partners had to say about Koninklijke Philips N.V. (NYSE:PHG) in its Q4 2021 investor letter:
“In the health care sector, our biggest detractor was Philips. Philips was a Q3 purchase. After exiting more consumer-focused businesses such as TV and lighting over the past decade, Philips has become a health care technology company operating across three main areas: diagnosis and treatment, connected care, and personal health. Shares came under pressure due to a recall of its first-generation CPAP machine for sleep apnea and fears regarding potential litigation. This created our opportunity to get involved. However, following our initial purchase, shares fell further in November after the FDA provided an update on the device recall and delineated deficiencies identified from an inspection of the device’s main manufacturing facility, which in itself is not unusual. Investors’ key sources of concern likely center around the recall expanding to additional products, the potential for legal recourse, and potential market share losses arising in the sleep division. Nonetheless, the sleep division is a small part of the overall business—which we do not believe is going to zero. The company has a large installed base of medical diagnostic equipment (e.g., MRI/PET/CT/ultrasound scanners) that offers a high recurring stream of software-like maintenance revenues. This is a sticky business as medical providers are reluctant to switch over to competitors. We believe shares have been overly penalized, so we added to our position on weakness.”