The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is home to a good number of high quality companies. None more so than private hospital operator Ramsay Health Care Limited (ASX: RHC).
With its 223 hospitals across six countries admitting over 3 million patients each year, I believe Ramsay is one of the best buy and hold investment options available to Australian investors today.
At 29x estimated FY 2017's earnings it may be a little on the expensive side, but I firmly believe this is justifiable thanks to the company being positioned for sustainable long-term growth.
Ageing populations will be one key driver of growth. According to a recent presentation the global population aged 60 and above is forecast to more than triple by 2050.
Furthermore, increased prevalence of chronic health conditions is expected to drive demand for treatment. The company has pointed to China's 92 million diabetics as one such opportunity.
I believe this is an indication that we will soon see Ramsay expand into the massive China market. A joint venture in the country may have been cancelled earlier this year, but I feel sure that's not the end of the matter.
Another good reason to buy and hold Ramsay is its dividend. Its shares may only provide a fully franked 1.9% dividend at present, but the company has a long history of dividend increases.
In fact, in the last 10 years Ramsay has managed to grow its dividend by an average of 17% per annum.
If over the next 10 years the company grew its dividend at just half the current rate, this year's $1.39 per share dividend would grow to be worth $3.15 per share. Which is the equivalent of a yield on cost of 4.6%.
Ramsay may come at a premium to fellow private hospital operator Healthscope Ltd (ASX: HSO), but I believe it is worth every cent of it.
Over the next 10 years I feel confident that Ramsay will outperform its rivals and deliver market-beating returns for investors.
