If you're looking for stocks that can deliver outstanding gains in good economic conditions and bad, there are at least three great options for you right now in the healthcare sector.
Investors with shares of Trillium Therapeutics (TRIL), Teladoc Health (TDOC -2.18%), and Nanox (NNOX -2.32%) have good reasons to expect big returns this year. Read on to see why they could deserve a spot in your portfolio too.
This company's developing X-ray technology that could rapidly boost access to medical imaging services that are currently unaffordable for many. Digital technology has improved image quality a great deal, but tubes that produce the X-rays themselves are still expensive to run and even more expensive to replace.
Nanox made its stock market debut last August and in the process raised around $190 million to produce Nanox.ARC, a low-cost digital X-ray imaging system. Nanox.ARC doesn't rely on pricey X-ray tubes that use tons of electricity to generate a stream of electrons. Instead, it employs millions of tiny nano-cones on silicon chips to produce electron streams under low voltage.
The company expects to receive FDA clearance to market a multi-source Nanox.ARC system by the middle of 2021. The company also expects clearance from the European Commission in the second half of 2021. If approved in both locations the company could begin a worldwide rollout by the end of the year.
2. Teladoc Health
When it comes to making acquisitions that create value for its investors, this digital health pioneer has a strong track record. In 2015, Teladoc Health facilitated about half a million telehealth visits. Now, the company is on pace to collect fees from over 200 million visits annually.
Teladoc Health owes its success to purchases that expanded the company's role in America's convoluted healthcare system, but the latest investment was a lot bigger than expected. Teladoc Health raised a lot of eyebrows when it acquired another digital health specialist called Livongo Health for around $18.5 billion last year.
Livongo Health's services interpret data from internet-connected devices to provide personalized services for people with chronic conditions. Roughly half of adults in the U.S. could use help with at least one chronic condition, but few receive any. As a result, treatment of chronic conditions consumes around four-fifths of total healthcare spending.
Healthcare plan sponsors eager to keep their employees out of hospitals were signing their employees up for Livongo services at a rapid pace, before merging with Teladoc Health but Livongo had just scratched the surface. Signs of growth accelerated by cross-selling this year could send Teladoc Health stock soaring.
3. Trillium Therapeutics
This company's developing new cancer drugs that could entice a big pharmaceutical company to make a juicy buyout offer this year. Trillium Therapeutics' lead candidates, TTI-662, and TTI-621 target CD47, a protein that cancer cells use to avoid the immune system.
Early stage clinical trial results from lymphoma patients that have failed at least two lines of standard treatment, and multiple myeloma patients that failed at least three, suggest Trillium Therapeutics is on the right track. As a monotherapy, TTI-662 shrank tumors for six out of the first 17 patients treated with a wide range of doses.
Raising the dose of TTI-662 appears to improve the rate of response, and investigators haven't found dose-limiting toxicities yet. In other words, TTI-662 looks good now but it could look a lot better after Trillium Therapeutics provides clinical trial updates near the end of March.
No straight lines
While the long-term outlook for all three of these healthcare stocks is generally positive, it's important to remember top-performers never move up in a straight line. These stocks could soar this year, but that doesn't necessarily mean you should let them go if they don't.