Medical stocks are stocks of the companies involved in medical technology. Such companies manufacture medical devices and perform extensive research and development in the field of medicine. Medical technology companies also include medical systems companies, medical aesthetics companies, medical equipment companies, medical labs, and drug makers.
The performance of medical stocks is measured in terms of Composite Ratings, and most of them have very high composite ratings of around 95. It implies that in the most recent times, medical stocks have outperformed 95% of all other stocks. Medical stocks have had a good run in 2019 and have generated high returns.
Factors to Consider Before Investing in Medical Stocks
Medical stocks follow a high-risk high-reward profile. The success or failure of medical technology companies largely rely on the acceptance or non-acceptance of innovative products, and the results of new research and development.
However, medical stocks are still less volatile and risky than biotechnology and pharmaceutical stocks as political and regulatory concerns do not plague them.
Before investing in medical stocks, investors must consider the composite ratings of the stocks. Additionally, investors must consider the fundamentals of the companies, including revenues, earnings growth, P/E ratios, and dividend yield.
Which Medical Stocks Should I Buy?
Several medical stocks trade on the stock exchanges. Among them, we have shortlisted the best medical stocks for your reference. Investors should apply extensive research, analysis, and due diligence before picking suitable stocks for them.
Investors must note that medical stocks are more suitable for long-term capital gains rather than short-term dividend income. Therefore, the dividend yield should not be the deciding factor. Instead, investors must look for the overall strength of the companies’ fundamentals, innovation, the efficiency of the research & development teams, and market capitalization of companies before investing in medical stocks.