Malhotra: VRX Price Target $220 (Analyst = 85% Success Rate)Shibani Malhotra from Nomura Holding met Valeant Pharmaceutical's CEO, J. Michael Pearson following the latest investor's call in October. As a result, Malhotra reiterated a Buy rating on the stock with a price target of $220.
Malhotra'shttps://www.tipranks.com/analysts/shibani-malhotra. Average return as per her recommendation is 27.1%.
Health care tends to be a top-performing sector of the stock market. But this year is different, which means you might be able to buy shares cheaply and profit handsomely in the long run.
Here’s how the 10 sectors of the S&P 500 Index SPX, +0.06% have performed this year, along with three-, five- and 10-year total returns, with dividends reinvested:
| S&P 500 sector |
Totalreturn - 2015 |
Total return - 3 years |
Total return - 5 years |
Total return - 10 years |
| Consumer Discretionary |
4% |
66% |
148% |
174% |
| Health Care |
2% |
82% |
151% |
168% |
| Consumer Staples |
-3% |
41% |
93% |
172% |
| Information Technology |
-3% |
39% |
98% |
133% |
| Industrials |
-4% |
40% |
96% |
127% |
| Telecommunications Services |
-7% |
3% |
51% |
94% |
| Financials |
-9% |
51% |
71% |
-4% |
| Utilities |
-11% |
30% |
64% |
90% |
| Materials |
-15% |
17% |
42% |
95% |
| Energy |
-22% |
-11% |
26% |
40% |
| S&P 500 |
-4% |
42% |
90% |
98% |
Source: FactSet
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What’s surprising is how well health-care companies boosted earnings. Here are the 10 sectors again, this time ranked by weighted growth of earnings per share:
| S&P 500 sector |
Second-quarter EPS growth |
| Health Care |
14.71% |
| Telecommunications Services |
11.84% |
| Consumer Discretionary |
10.45% |
| Financials |
9.64% |
| Materials |
7.76% |
| Information Technology |
6.15% |
| Utilities |
4.45% |
| Consumer Staples |
1.70% |
| Industrials |
0.11% |
| Energy |
-55.76% |
| S&P 500 |
0.14% |
| Source: S&P Capital IQ |
S&P Capital IQ senior analyst Lindsey Bell said in a report that it’s “hard to reconcile the sector’s recent decline.” She said health care has been a driver of earnings growth “for the past several quarters, posting double-digit growth in each of the previous five quarters (including growth of more than 20% in fourth-quarter 2014 and first-quarter 2015).”
Big increases in people signing up for health insurance and Medicaid “should result in higher utilization and help most health-care sub-industries report solid sales and EPS growth.”