One area of the market which I think is a great place to look for buy and hold investments is the healthcare sector.
This is because favourable tailwinds are being experienced in the sector at the moment that are expected to lead to increasing global demand for healthcare services for the next couple of decades.
In light of this, I think a number of listed healthcare companies are capable of growing earnings at a strong rate for the foreseeable future.
Three which I think are worth looking closer at are listed below. Here's why I like them:
CSL Limited (ASX: CSL)
I think this biotherapeutics company's recent half-year result demonstrated why it is regarded as one of the highest quality companies on the Australian share market. I believe the result has been a stand out during earnings season and shows the significant potential of its fledgling Seqirus influenza business. I feel the emergence of Seqirus should support the growth being exhibited by its core business, leading to solid profit growth over the coming years.
Nanosonics Ltd. (ASX: NAN)
Nanosonics is a leading infection control company with an increasingly popular trophon EPR product. The product is used to clean ultrasound probes and is regarded by many as being the best in its class. Pleasingly, it is also an environmentally friendly product, making it the ethical choice for ultrasound operators. Although the number of installed bases has been growing at an impressively strong rate, it still only has a 12% share of the estimated global market. This should mean it has a long runway for growth ahead of it. This could be given an additional boost if the two new products it has in development are a success.
Volpara Health Technologies Ltd (ASX: VHT)
This under-the-radar healthcare company is certainly one to watch in the future. While its shares are looking a little expensive at the moment, there is a chance it will be able to grow into this valuation. After all, demand for its technology has been growing so strongly that It is well on its way to exceeding its 200% increase in annual recurring revenue target for FY 2018. Volpara's valuable technology allows personalised, high-quality breast cancer screening based on automated, objective measurements of breast density, compression and radiation dose.
