The health sector is regaining strength.
According to Quint Tatro, president of Joule Financial, the sector is shaking off past worries that weighed on the group.
“The general uncertainty surrounding this overall health parameter has been very worrying and weighed on the entire sector,” Tatro told CNBC on Thursday.Trading nation. “” We are now getting this relief and are seeing this particularly strong recovery in this sector again because the blue wave is not coming through. “
Although Vote counting is still afoot in several battlefield states, stocks rising Thursday as Wall Street appeared to warm to the idea of Democratic candidate Joe Biden in the White House and Republicans retained control of the Senate.
“The whole group … much like the general market was very concerned about this type of blue wave and what it would mean for the entire industry if the Democrats were able to push through ‘Medicare for All’,” said Tatro.
The XLVThe ETF, which tracks healthcare stocks, closed in the green on Thursday, rising less than half a percent after hitting a new all-time high the day before. Tatro said he wouldn’t chase her right away, but there are still a few names he would add to his portfolio.
“Two of our favorites are two of the big pharma games, and that’s it Pfizer and Merck. First and foremost, these are names that have better records in the industry than most, “he said.” You’re still quite heavily in debt so this is something you need to take into account if and when we ever see higher interest rates. I doubt this will happen anytime soon, but Pfizer is trading around 12 times the forward earnings and Merck around 13 times. Good value. “
JC O’Hara, Chief Marketing Technician at MKM Partners, agrees with Tatro on health care recovery and has a few of its own stocks to choose from.
“Some of the most important outbursts we see today [Thursday] come from managed care stocks. United health, Cigna, anthem. They’re all on the rise, “O’Hara said on the same show before delving into Anthem’s technical levels.
“There was strong resistance on the upside at $ 310, great support at $ 230, and the fact that we can prevail well above the resistance suggests another uptrend, and I’m saying this because historically they usually come, when we see strong rallies after a big consolidation, “said O’Hara. “We believe there is at least another 20% more than it is now, so we could set a technical target of $ 400 here for Anthem.”
The anthem fell 2.5% on Thursday.
Disclosure: Joule Financial and Tatro own shares in Pfizer and Merck