Entries filed under 'Health Care'

    Was the Affordable Care Act a "Bond-Aid"?

    September 10, 2014 10:35 AM by Lord Abbett Editorial Staff

    While the ACA definitely helped stocks, its impact on bonds was actually a mixed bag. Tax-free bonds issued by hospitals have remained attractive.  

    When the U.S. Supreme Court upheld the ACA at the end of 2012, both the Merrill Lynch High-Yield Healthcare Indexand Merrill Lynch Investment-Grade Healthcare Index2 were already trading close to their overall asset class indexes, reflecting those sectors’ generally perceived defensive characteristics.

    According to Lord Abbett Research Analyst Bill Carpenter, both of those healthcare indexes have modestly underperformed the Merrill Lynch High Yield Master II Index3 and Merrill Lynch U.S. Corporate Master (A) Index4, respectively, ever since for that reason—and because of the combination of the low interest-rate environment and the availability of other better-yielding sectors within the respective corporate universes. Thus, most of the overall healthcare sector’s volatility (both positive and negative) has been reflected in stock prices rather than bond prices.

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    Taking Health Care of Your Investments

    September 4, 2014 10:53 AM by Lord Abbett Editorial Staff

    Long considered defensive, the healthcare sector has been one of the best performing sectors of late. How sustainable is this trend?

    In an article that might rile detractors of the Affordable Care Act (ACA), three business professors recently extolled the long-term benefits of investing in the healthcare industry, especially now that national healthcare spending since 2013 is expected to grow faster than the overall economy through 2020, regardless of legislative changes.

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    Research in Action: Politics and Snafus Aside, a Strong Prognosis for Health Care

    May 15, 2014 9:46 AM by Devesh Karandikar

    Analyzing companies that stand to benefit from greater utilization of products and services thanks to a much larger patient population

    Healthcare_Operating-Room

    Think the Affordable Care Act (ACA) has been bad for health care stocks? Actually, health care has been one of the best performing sectors in the S&P 500® Index in the past five years (see accompanying chart), and the fundamentals for industry leaders remain strong as the insured population and healthcare spending continue to grow. (See "Genes, Drugs, and Rock and Roll.")

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    Do Biotechs Have More Upside?

    April 22, 2014 11:56 AM by Lord Abbett Editorial Staff

    Lord Abbett has identified three encouraging trends for the sector.

    Forty-three years after President Richard Nixon launched a national “war on cancer,” millions have died, millions have extended their lives with new and improved treatments, and billions of dollars have been made by investors in biotechnology and pharmaceutical companies on the front lines.  A case in point is the NYSE Arca Biotechnology Index (BTK), which has a high concentration of companies with cancer compounds in various stages of development, is up 295% in the five years through April 17, 2014.

    Is all the good news priced into biotech stocks?  Or do the long-term fundamentals justify continued bullishness?  

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