The ASX healthcare sector continues to be one of the top-performing market sectors. The demand for healthcare products and services only continues to grow. An ageing global population and continuing advances in healthcare treatments and technology are driving this demand.
Here we examine 2 of my top ASX healthcare shares picks right now: Nanosonics Ltd. (ASX: NAN) and Ansell Limited (ASX: ANN).
Nanosonics
Nanosonics manufactures and distributes market-leading disinfection system for ultrasound probes. Its core product is the trophon EPR disinfection system, which has gained industry reputation as the market leader. The device is fully automated, quick to use and does not require chemicals.
As well as selling the trophon system product units, the company also sells a range of ancillary products. These recurring consumables grow additional strong revenues over time, in line with the growth of its installed core product unit. This results in a strong combined revenue stream. Nanosonics recorded revenue of $48.5 million for the first half of FY 2020. This was an increase of 19% on the prior corresponding period (pcp).
The company has strong geographic diversification. Its overseas markets generate 90% of its revenue. Nanosonics continues to grow revenue very strongly in its largest market, the US. It is also seeing strong growth across Asia, Europe and the Middle East.
Nanosonic's strategic priorities moving forward focus on 4 core areas. This includes continuing to establish trophon technology as the industry standard in its operating markets. This ASX healthcare share will also look at expanding and investing in new markets.
Nanosonics could capitalise on the growing global trend towards stricter disinfection control over the next 5–10 years. Globally, more and more health agencies are taking measures to enforce stricter policies to protect against hospital-acquired infections.
Ansell
Ansell is involved in the development, manufacturing and sale of gloves and protective personal equipment in the industrial and medical markets. It has broad geographic and customer diversity with sales operations in over 50 countries. Also, most of its new product lines are patentable and must comply with ever-increasing regulatory standards. This further strengthens its competitive position.
A business update in late March revealed a high demand for its hand and body protection products. These products are industry certified for protection against infections such as the coronavirus.
Ansell is well-positioned to grow over the next decade through rising demand for protective personal equipment in the healthcare segment.
Ansell shares are currently trading on a forward dividend yield of 1.9%, unfranked.
