As the crisis from the COVID-19 pandemic subsides, and the number of casualties decreases, many parts across the world are breathing a collective sigh of relief.

However, the effects of the pandemic will continue to be felt for a long time, possibly for decades.

The healthcare industry is among the most significantly impacted by the pandemic, and is undergoing a rapid transformation.

Also, it has accelerated the need for more innovative and effective healthcare solutions, bringing new opportunities to make money.

And if high-interest rates persist and cause a recession in the U.S. economy, as forecasted by numerous experts, they believe that the healthcare sector has the potential to perform well again this year.

Regardless of economic conditions, people tend to regularly visit their doctors and take their prescribed medications.

Just because there’s a recession doesn’t mean that people will stop taking care of their health, do they? 

This time around, the healthcare sector may be in an even stronger position compared to previous recessions, due to the fact that a larger portion of Americans now has healthcare coverage through government-sponsored plans.

This should make healthcare spending less affected by the state of the economy.

Can’t blame these companies though, if they are wanting more people to need medical help! 

And with most stocks in the healthcare sector down for 2023, and not joining the bullish move of the general market, healthcare investors might just have been given a perfect opportunity to buy.

For this week, I have several stocks in the healthcare industry that are well-positioned to perform in a post-Covid environment. 

Let’s take a look!

Pfizer, Banking on Expansion Across the Board

Pfizer is expected to experience robust sales growth, excluding COVID-related products, due to the introduction of new offerings.

The company believes that the products it launches in the first half of 2024 will contribute an additional $20 billion in annual revenue, adjusted for risk, by 2030, surpassing the anticipated decline in sales from the loss of exclusivity for older products. 

With its substantial cash reserve and robust cash flow, Pfizer intends to fund additional business development deals, which are expected to generate an additional $25 billion in annual revenue by 2030.

The company has already made considerable progress toward this goal, having acquired Arena, Biohaven, Global Blood Therapeutics, and ReViral and estimating that these acquisitions will bring in an additional $10.5 billion in annual sales by 2030.

Furthermore, Pfizer’s new products may surpass sales projections and its pipeline could yield more successful products than originally forecasted.

The company may also engage in further acquisitions or licensing agreements that drive its growth beyond investor expectations.

Additionally, COVID-19 could potentially generate greater long-term revenue and profits than is currently anticipated.

In my opinion, Pfizer has the potential to exceed expectations in the coming years, especially with its very compelling dividend yield of 3.73%, which compensates investors while they await the company’s return to growth.

Gilead Sciences

Gilead Sciences was one of the first companies to release a treatment for COVID-19, receiving emergency approval for its antiviral drug, Remdesivir, in May 2020.

The drug, now known as Veklury, is still being used, though its usage has declined.

Gilead Sciences is well-known for its dominance in the HIV drug market, but in recent years, its revenue has been sustained primarily by its COVID-19 treatment, Veklury.

The company faced regulatory challenges and was unable to launch some products, but Veklury kept its financial performance afloat.

Due to declining COVID hospitalizations and the increasing availability of oral antiviral drugs like Pfizer’s Paxlovid, sales of Gilead Sciences’ Veklury, which is delivered through intravenous infusion, are starting to face pressure.

Despite this, the company’s pipeline, including its oncology and HIV units, is expected to continue advancing this year with multiple phase 2 and phase 3 studies underway.

In the long term, the company should secure new approvals and label expansions, just as it has in the past. Once the impact of Veklury on its financial results fades, Gilead’s top-line growth rate is likely to improve.

Gilead Sciences’ dependable dividend is yet another reason to invest in its shares.

The biotech company recently announced a 2.7% increase in its dividend, a move it has made regularly in the past.

The stock boasts a yield of 3.48%, which is significantly higher than the average yield of 1.74% offered by the S&P 500.

In conclusion, Gilead Sciences is a well-established company with a strong business and a reliable dividend, making it an attractive option for long-term investors.

Merck

Pharmaceutical giant Merck boasts a diverse range of products across multiple therapeutic areas.

Although its cancer drug Keytruda is the company’s most well-known and valuable asset, Merck also has other significant offerings in its vaccine and animal health divisions.

The drugmaker’s vaccine and animal healthcare segments are projected to provide robust financial results for the rest of the decade, reducing the risk of a significant decline in annual revenue in the next five years.

With a focus on earning new approvals, Merck is actively pursuing opportunities.

One promising candidate is Sotatercept, a potential treatment for pulmonary arterial hypertension.

The company acquired this candidate through its acquisition of Acceleron Pharma in 2021.

Merck is also expected to make a midsize acquisition to enhance its long-term growth potential. Although a deal has yet to be made, the company is expected to make a significant investment within the next two years. 

With strong free cash flow, Merck is capable of executing a midsize transaction sometime in the future. And don’t forget about its solid dividend program, which makes it a strong choice for investors seeking growth, value, and a reliable income stream.

Still, Don’t Count Out Covid Just Yet

The healthcare industry had a rough beginning in 2023, as concerns mounted over a resurgence of the coronavirus.

It’s important to note that although the virus has become less of a threat in recent times, the appearance of a new subvariant of the deadly Omicron strain, and the possibility of additional mutations in the future cannot be ignored.

Despite the current concerns about a resurgence of COVID-19, the healthcare industry has undergone a tremendous amount of innovation in the past two years, making it a compelling option for investors.

With billions being invested in areas with high growth potential such as infectious diseases, cancer, virology, and neurological diseases, the healthcare and biotech sectors are expected to provide long-term returns for those who invest.

Still, healthcare investors who are looking for quick gains may need to be patient. Just make sure you keep yourself healthy while waiting!

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