If your portfolio hasn’t been performing to expectations this year then now could be a good time to bring it to life with one of the top healthcare shares listed below.
I believe all three have the potential to provide market-beating returns over the next few years, potentially making them great options today. Here’s why:
CSL Limited (ASX: CSL)
If you only have room for one healthcare share in your portfolio, I would choose CSL. I’m a big fan of the biotherapeutics giant due to the quality and strength of its CSL Behring and Seqirus businesses. CSL Behring is the global leader in plasma therapies and Seqirus is the second biggest influenza vaccines company globally. I remain confident that both businesses will grow their earnings strongly over the long term thanks to their leading products and heavy investment in research and development.
Nanosonics Ltd (ASX: NAN)
Nanosonics is the infection control specialist behind the increasingly popular trophon EPR disinfection system for ultrasound probes. This system has been growing its installed base at a rapid rate over the last few years and reached 19,310 units globally earlier this year. The beauty of this is that as the installed base grows, so too do the sales of the consumables that it requires. Pleasingly, whilst this installed base is clearly very large, it is still only a fraction of the global market opportunity estimated to be 120,000 units. Due to the quality of the product and favourable regulatory recommendations, I believe Nanosonics is well-placed to grow its market share materially over the next decade. In addition to this, its sales should be given an additional boost from the launch of several new products targeting unmet needs.
Volpara Health Technologies Ltd (ASX: VHT)
A final healthcare share to consider buying is Volpara. It is a medical technology company which provides software that leverages artificial intelligence imaging algorithms to assist with the early detection of breast cancer. I’ve been very impressed with its progress over the last few years and particularly its performance in FY 2019. Volpara posted a 78% increase in revenue in FY 2019 thanks to its increasing market share in the United States. At the end of the period its market share had grown by a whopping 120% to 7.1%. Due to the quality of its offering and recent acquisitions, I expect more of the same in FY 2020 and beyond.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended Nanosonics Limited and VOLPARA FPO NZ. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.