Moving into 2019, Wall Street research firms have a positive outlook for U.S. healthcare stocks, according to a Reuters report.
The publication states that its review of ratings from 13 large Wall Street research firms found the S&P 500 healthcare sector is the most favored among the main S&P 500 sectors.
Noah Weisberger, managing director for U.S. portfolio strategy at Bernstein, a Wall Street sell-side research and brokerage firm, cited healthcare being a "really nice diversified earnings stream."
Reuters noted this diversity is from the different companies within healthcare, such as prescription drug manufacturers, medical device makers, insurance companies and hospitals.
Martin Jarzebowski, sector head of healthcare for financial services company Federated Investors, told Reuters healthcare "is one of the few sectors with high quality, above-market growth and it's relatively immune to the array of macro headwinds that we see out there."
Overall, S&P 500 healthcare companies are expected to see a 7.5 percent increase in earnings for 2019, compared to 6.3 percent growth projected for S&P 500 companies generally, according to the report, which cites IBES data from Refinitiv.
But Reuters reported that the healthcare sector has been slow going at the beginning of this year, and some investors are not optimistic that the sector will outperform. According to financial information website MarketWatch, the S&P 500 healthcare index returned 1.6 percent this year through Jan. 11. That compares to 3.6 percent for the S&P 500 index.
Access the full Reuters report here.
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