The world population is aging, with variations by country. By mid-century, projections indicate that 16 percent of the world population will be ages 65 and older, up from 9 percent now. The percentage of people in this age bracket in the world’s more-developed countries is projected to reach 27 percent, up from 18 percent now.
Macrovue’s investment committee looks at four companies poised to benefit from an ageing population.
HCA Healthcare (NYSE: HCA)
On 1 February 2019 HCA announced it has finalised the purchase of Mission Health, a six-hospital system in Asheville and western North Carolina, for approximately $1.5 billion. Mission Health, having been cited as one of the nation’s top 15 health systems by IBM Watson Health, is now a new operating division of HCA Healthcare. Benefits and highlights of the transaction include the following commitments: HCA Healthcare will build a 120-bed inpatient behavioural health hospital in Asheville. HCA Healthcare will build a new replacement hospital for Angel Medical Centre in Franklin, N.C. and will complete the new state-of-the-art Mission Hospital for Advanced Medicine in Asheville. In addition to the new behavioural health hospital, replacement hospital and new tower, HCA Healthcare will invest $232 million in capital in Mission Health facilities. HCA Healthcare will also create a $25 million Innovation Fund focused on improving healthcare service delivery and spurring economic development.
HCA Healthcare has returned +47.13% over the past 12 months (to 29 March 2019).
Medtronic (NYSE: MDT)
“DUBLIN - April 8, 2019 - Medtronic plc today announced results of a study published in JAMA Network Open that demonstrates a reduction in health care utilisation and cost for cancer pain patients using targeted drug delivery (TDD) and conventional medical management (CMM) vs. CMM alone. The study found significant cost savings to payors, with fewer inpatient visits, shorter inpatient length of stay, and fewer emergency department (ED) visits for the TDD and CMM group. Over 12 months, TDD therapy was associated with a significant mean overall cost savings of $63,498 and fewer oral opioid prescriptions per patient. TDD, delivered via the Medtronic SynchroMed Infusion System ("Medtronic Pain Pump"), is an alternative to oral opioids for patients and provides effective pain relief at a fraction of the oral dose with fewer side effects and may help reduce the use of oral opioids. The SynchroMed Intrathecal Drug Delivery system is an implantable pump that delivers medication directly to the fluid around the spinal cord, enabling clinicians to prescribe reduced doses compared to systemically delivered medications. Randomised trial data showed that TDD provides better pain relief with fewer side effects when compared to CMM. The National Comprehensive Cancer Network recommends TDD as an option for patients who experience intolerable side effects or in whom systemic opioids are not effective.”
Medtronic has returned +24.91% over the past 12 months (to 29 March 2019).
Omega Healthcare Investors (NYSE: OHI)
The company presented at Barclays Global healthcare conference in March 2019. The slide deck is definitely worth a look.
Omega Healthcare Investors has returned +63.07% over the past 12 months (to 29 March 2019).
Royal Caribbean Cruises (NYSE: RCL)
As for Royal Caribbean, we are a bit surprised at its 12-month performance give the positive trends for the cruise industry in terms of demand and pricing. 2018 saw overall global cruise demand up a solid 6.7% and most analysts are forecasting that 2019 will be stronger still. RCL has indicated recently that bookings momentum remains strong and Royal’s new ships appear to be garnering the highest pricing premiums versus their existing fleets out of all the new megaships. The stock is acting better as well and is now (as of 25 April 2019) up some 23% since the end of 2018 (in USD).
Royal Caribbean Cruises has returned +6.21% over the past 12 months (to 29 March 2019).
You can invest in these companies directly through Macrovue's Silver Haired Economy share portfolio.
This portfolio has returned 17.82% over the last 12 months (to 29 March 2019).
Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual and does not constitute financial advice. Consider the appropriateness of the information in regards to your circumstances.
Past performance is not a reliable indicator of future performance.