Healthcare has long been one of the most dependable long-term growth themes for investors. With aging populations and rapid advances in medical technology, the demand for innovative treatments, diagnostics, and healthcare services continues to grow.
From biotech breakthroughs to essential medical devices, these companies are well-positioned to ride the wave of long-term industry trends.
Here are 10 undervalued healthcare stocks that could be worth watching if you’re looking to invest in the healthcare space.
Here are 3 picks that look the most undervalued today from this list.
UnitedHealth Group (UNH)
- Market Cap: $370 billion
- Industry: Health Care Providers and Services
- Analyst Upside: 35%
- P/E Ratio: 15
Company Overview: UnitedHealth Group is a diversified healthcare company offering health insurance through UnitedHealthcare and healthcare services via Optum, which includes pharmacy benefits, care delivery, and data analytics.
Business Strategy: The company generates revenue by providing insurance premiums and health services, aiming to integrate care delivery with data-driven insights to improve outcomes and reduce costs.
Recent Developments:
- Earnings & Profitability: Reported solid revenue growth, though earnings faced pressure due to increased medical costs and challenges within Optum.
- Business Growth Trends: Expanded its customer base, adding over 2 million domestic consumers to UnitedHealthcare and increasing value-based care patients through Optum.
- Shareholder Returns: The company affirmed its 2025 outlook, indicating confidence in sustained growth and operational strength.
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Merck (MRK)
- Market Cap: $210 billion
- Industry: Pharmaceuticals
- Analyst Upside: 27%
- P/E Ratio: 9.4
Company Overview: Merck & Co. is a global pharmaceutical company known for its involvement in oncology, vaccines, and animal health, with flagship products like Keytruda and Gardasil.
Business Strategy: Merck focuses on innovative drug development and strategic acquisitions to bolster its pipeline, aiming to address unmet medical needs and expand its global footprint.
Recent Developments:
- Earnings & Profitability: Merck has continued to experience strong sales from its oncology and vaccine portfolios, which has helped to support strong financial performance.
- Business Growth Trends: Merck recently announced the acquisition of SpringWorks Therapeutics to enhance its rare cancer therapies portfolio, aiming to offset potential revenue losses from patent expirations.
- Shareholder Returns: Merck is focused on strategic acquisitions and high-growth therapeutic areas to drive sustainable long-term growth.
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Pfizer (PFE)
- Market Cap: $135 billion
- Industry: Pharmaceuticals
- Analyst Upside: 22%
- P/E Ratio: 8
Company Overview: Pfizer is a multinational pharmaceutical and biotechnology corporation developing medicines and vaccines across various therapeutic areas, including immunology, oncology, and cardiology.
Business Strategy: Pfizer is refocusing its business around high-growth therapeutic areas like oncology and immunology while streamlining operations and doubling down on pipeline innovation to rebuild momentum beyond COVID-related revenues.
Recent Developments:
- Earnings & Profitability: Despite a decline in COVID-19 product sales, Pfizer exceeded profit expectations due to effective cost management.
- Business Growth Trends: Pfizer reaffirmed its 2025 earnings forecast, emphasizing growth in oncology, vaccines, and immunology segments.
- Shareholder Returns: Pfizer’s stock has struggled in recent years, but the company continues to return capital to shareholders through a solid 7% dividend yield and plans for share repurchases as it works to stabilize earnings and restore investor confidence.
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TIKR Takeaway
UnitedHealth Group, Merck, and Pfizer stand out as undervalued healthcare stocks today with strong long-term potential.
Investors looking to invest in the healthcare sector may want to keep these names on their radar.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
