Australia is a world leader in healthcare services, and the ASX is home to a number of blue-chip healthcare companies, most of which have seen strong share price gains in recent years.
Here we take a look at 2 leading ASX healthcare companies, Cochlear Limited (ASX: COH) and Ramsay Health Care Limited (ASX: RHC), both of which I believe offer reasonable buying opportunities to share investors right now.
Cochlear
Cochlear has seen solid growth over the last decade with industry-leading products, driven by a high level of investment in research and development. As the proportion of the global population over 65 continues to grow, there will be a rising demand for hearing products and solutions over the next few decades.
Cochlear has witnessed significant disruption to its business due to the coronavirus crisis, as elective surgeries such as those for Cochlear implants have been deferred across a number of countries. To address this issue, and shore up its balance sheet, Cochlear successfully raised $880 million from an institutional placement in late March.
I believe that the downside to Cochlear's business has been sufficiently factored into its current share price, which has undergone a significant market correction since late February. Elective surgeries are already recommencing in countries such as Australia. More countries are set to follow in the months ahead – a positive sign for Cochlear.
Despite the market volatility that may continue over the next few months, I believe that now could be a good time to purchase shares in this blue-chip healthcare company at a more attractive price.
Ramsay
Like Cochlear, global private hospital provider Ramsay has also been impacted by a ban on all non-essential surgeries in the countries where it operates. It has also undergone a capital raising to strengthen its financial position. In addition, it suspended its dividend payments for the first time in 20 years.
However, with elective surgeries recommencing, I believe that Ramsay may emerge from its coronavirus troubles faster than first anticipated. While there has been some bounce back in its share price since late March, Ramsay's current share price of $61.20 is still well below its peak in February of $80.93.
I believe that now presents a reasonable buying opportunity for patient long-term investors. Due to the world's ageing demographics and continuing advances in healthcare treatment and technology, the demand for first class hospital services will only increase over the next decade. As one of the largest and most diverse hospital providers in the world, with services across 11 countries, I believe that Ramsay is well positioned to capitalise on this growing trend.
