Edison Exhibits- Healthcare demand remains robust
Source: Refinitiv, Edison Investment Research. Note: Valuation data as at 6 January 2020.
Source: Refinitiv, Edison Investment Research. Note: Valuation data as at 6 January 2020.
Exhibit 2 shows the valuation of global pharma stocks, which are by far the most dominant subsector of the healthcare industry. The Datastream World Pharma index is trading on a forward P/E multiple of 16.0x, which is broadly in line with its five-year average. Pharma stocks are trading in line with the world market, which compares with a 6.1% average premium over the last five years. Taken together, the backdrop of favourable industry fundamentals, robust levels of M&A and undemanding valuations suggest that investors with a longer-term view may benefit from exposure to the healthcare sector
Exhibit 2 shows the valuation of global pharma stocks, which are by far the most dominant subsector of the healthcare industry. The Datastream World Pharma index is trading on a forward P/E multiple of 16.0x, which is broadly in line with its five-year average. Pharma stocks are trading in line with the world market, which compares with a 6.1% average premium over the last five years. Taken together, the backdrop of favourable industry fundamentals, robust levels of M&A and undemanding valuations suggest that investors with a longer-term view may benefit from exposure to the healthcare sector