With populations around the world getting older and chronic disease burden increasing, demand for healthcare services is expected to rise strongly over the coming decades.
In light of this, I think the healthcare sector could be a great place to look for long term investments.
But which healthcare shares should you buy? Three that I feel could be long-term market beaters are listed below. Here's why I like them:
PolyNovo Ltd (ASX: PNV)
The first ASX healthcare share to buy is PolyNovo. It is the medical device company behind the NovoSorb Biodegradable Temporising Matrix (BTM) product. This wound dressing product is designed to treat full-thickness wounds and burns and has a sizeable $1.5 billion addressable market. However, management isn't resting on its laurels. It is looking to expand its usage into other markets. If this is successful, it would add a further $6 billion to its addressable market.
Pro Medicus Limited (ASX: PME)
Another ASX healthcare share that I think would be a top option is Pro Medicus. It is a leading provider of radiology IT software and services to hospitals, imaging centres, and healthcare companies. Due to increasing demand for its software from leading healthcare institutions, Pro Medicus has been growing its earnings at a rapid rate in recent years. This even continued in FY 2020 despite the pandemic. Over the 12 months, the company's underlying profit before tax increased 33.4% to $30.24 million. Pleasingly, due to its high quality software, sizeable market opportunity, and burgeoning sales pipeline, I believe Pro Medicus can continue its positive form for some time to come.
Ramsay Health Care Limited (ASX: RHC)
A final healthcare share to buy is Ramsay Health Care. Although trading conditions remain tough in the private hospital sector because of the pandemic's impact on elective surgeries, I expect a swift rebound once the crisis passes. Looking further ahead, I believe Ramsay's long term outlook is very positive. This is due to the aforementioned ageing global population and increased chronic disease burden. I expect this to lead to a sustained increase in demand for its services over the 2020s and beyond. Together with potential earnings accretive acquisitions, I believe Ramsay is well-placed for long term growth.
