Can Regis Healthcare Ltd, Sirtex Medical Limited and Healthscope Ltd rally higher while the S&P/ASX 200 falls?

Regis Healthcare Ltd (ASX:REG), Sirtex Medical Limited (ASX:SRX) and Healthscope Ltd (ASX:HSO) bucked the downward trend on Thursday to end the session higher.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The S&P / ASX 200 (Index: ^AXJO) (ASX: XJO) ended Thursday's trading session down 1%, which continues a significant downward trend that has seen the index lose over 130 points so far this week.

While many big name blue-chip stocks are crashing lower and hitting new 52-week lows there is a small band of stocks which are bucking the trend as investors seek out safe, defensive investments to protect them in this increasingly volatile market.

One sector which appears to be finding support is health care and while it's not universal with specific health stocks having their issues, it is interesting to note the performance of Regis Healthcare Ltd (ASX: REG), Sirtex Medical Limited (ASX: SRX) and Healthscope Ltd (ASX: HSO) on Thursday.

For the day, the above three stocks gained 1.5%, 0.9% and 0.8% respectively, which was a significant outperformance compared with the index.

The strong showing of these stocks suggests that investors may view them as 'safe havens'. While investors shouldn't lose sight of the requirement of not overpaying for a stock, it is reasonable to suggest that a premium for enduring earnings power is warranted given the defensive revenue streams these companies possess.

Regis is a leading provider of residential aged care facilities and retirement villages; Sirtex manufactures and distributes an innovative cancer therapy; while Healthscope is a large private hospital operator. Obviously all three companies provide essential services whose demand will continue to increase with an aging, wealthier population.

These defensive qualities are reasonably certain and reasonably stable which makes them enticing businesses to own especially if your view is that the economy and market may struggle to make further gains in the coming year. For this reason alone, it wouldn't be surprising to see 'high certainty' defensive, growth stocks such as these health care businesses emerge as a sought after sector for investors if this volatility continues.

Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »