Due to a number of positive tailwinds including population growth, ageing populations, increased chronic disease burden, and improving technology, I believe the healthcare sector is a great place for investors to look for long-term investments.
Three top healthcare shares which I believe are well-positioned to outperform over the next decade are listed below. Here's why I would buy them:
Cochlear Limited (ASX: COH)
One of my favourite healthcare shares is Cochlear. It is a leading developer, manufacturer, and distributor of cochlear implantable devices for the hearing impaired. I'm a big fan of the company as I believe it is well-placed for long term growth thanks to its exposure to the ageing population tailwind. According to the WHO, it estimates that there will be 1.5 billion people over the age of 65 by 2050, which is an increase from 524 million in 2010. This should mean Cochlear's addressable market grows at a solid rate over the next three decades, underpinning robust earnings growth.
Nanosonics Ltd (ASX: NAN)
Another of my favourites in the healthcare sector is Nanosonics. It is the infection control specialist behind the increasingly popular trophon EPR disinfection system which is used for ultrasound probes. I like the company due to the quality of the product and the recurring revenues it generates from consumables sales. Given the product's large market opportunity and management's plan to launch several new products targeting unmet needs in the near term, I believe Nanosonics is well-positioned to continue its strong growth for many years to come.
Pro Medicus Limited (ASX: PME)
Due to a sizeable pull back in its share price this week, I think once the market volatility subsides this healthcare technology company could be a great option for investors. Pro Medicus provides a full range of radiology IT software and services to hospitals, imaging centres, and healthcare groups worldwide. Demand for its software has been growing at a very strong rate, leading to the company posting an impressive 79.9% jump in underlying half-year net profit after tax to $9.2 million in FY 2019. Due to the quality of its software and its large market opportunity, I expect similarly strong growth over the coming years.
