Argus now sees some possible gems in the healthcare sector, the firm's analysts said in a recent research note.
While overall, the firm has a Market-Weight rating on the sector, Argus noted that the category is broad and has underperformed the S&P 500 year-to-date.
As a result, they believe investors have an opportunity to "pick up some consistently steady companies, with big brands, and solid financials." The "science-focused" and innovative stocks the firm believes could be gems are:
Intuitive Surgical (NASDAQ:ISRG) is a stock the firm likes in the MedTech sector, describing it as an "industry leader in minimally-invasive robotics-assisted surgery."
"The da Vinci robotics system has head-start advantage and technical innovations, resulting in large installed base of systems in U.S. and overseas markets," the firm explained.
Argus pointed to Catalent (NYSE:CTLT) in life sciences, noting its transition from COVID-19 vaccines to focusing on developing and commercializing advanced biologics and gene therapies, including weight-loss drugs, Muscular Dystrophy, and others.
Meanwhile, the firm stated that McKesson (NYSE:MCK), in pharmaceutical distribution, is one of the largest pharmaceutical distributors in the U.S., pointing to its platform to add services and technology to customers.
Biotechnology firm Biogen (NASDAQ:BIIB), which is down 16% in the last three months, is another stock that Argus believes is a "gem." The company develops, manufactures, and sells therapies for treating neurological and neurodegenerative diseases, including Alzheimer's.
One of the largest pharmaceutical companies in the world, Eli Lilly & Co. (NYSE:LLY), is one of Argus's favored stocks, with the firm noting the company's weight-loss drug development and its "promising treatment for Alzheimer's disease."
Finally, another pharmaceutical firm, Merck & Company Inc (NYSE:MRK), is Argus's final pick in healthcare, with the firm stating the company has a "number of successful products on the market targeting various cancers and diabetes, as well as animal health products and vaccines for a range of diseases."