A $60 Billion Corner Of The Healthcare Sector Nobody Is Talking About
In the small town where I grew up, our veterinarian was something of a local hero.
He'd take late night calls for a sick pet or a colicked horse. And given that our nearest hospital was an hour's drive away, he even x-rayed my broken elbow.
I even witnessed him miraculously revive my sister's dog after it had been struck by a car.
Like I said, he's a local hero in my small hometown.
But I'd wager that many folks across the country think of their animal physician as a hero. Similar to how grateful we are after a doctor helps us battle through an illness or mend a broken arm, we are forever thankful for the animal clinic that's cured our sick puppy or kitten.
Pets are a large part of our lives. Here in Austin, Texas, dogs are welcome in nearly every establishment. And new ones that cater to man's best friend are opening up all the time. Take Yard Bar for example -- a local business that features more than 20,000 square feet of playground for your dog. You can grab a burger and beer while your dog runs around and makes friends. The menu also features Bones & Co Sliders and PBP Ice Cream -- healthy snack items you can purchase for your dog.
Nearly 80 million homes, or roughly 65% of households in the United States, own a pet, according to a survey by the American Pet Products Association. This is up from the 56% of U.S. households that owned a pet in 1988, the first year the survey was taken.
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Last year, we spent more than $60 billion on our pets -- an 18% increase in the last five years. And half of that $60 billion was spent on only vet care and medicine. According to the American Pet Products Association, you can expect to spend around $235 annually on routine vet visits for your dog and roughly $196 for cats. Should your furry friend need surgery, that'll be a few hundred dollars, and then throw in the added cost for vitamins and medicines and it's easy to see how quickly the vet bill can add up.
Now understand I'm not aiming to discourage folks from owning pets, but to simply point out the ends we will go to in order to maintain their health and well-being. After all, when my sister's dog was hit by a car and our local vet brought it back to life, money was of no concern.
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The giant pharmaceutical distribution company, AmerisourceBergen (NYSE: ABC) realizes the potential that the pet industry, and more specifically animal health, has to offer. That's why the firm paid a 17% premium to buy out the leading animal health distribution company MWI Veterinary Supply for $2.5 billion last year.
It's clear that the well-being of our pets is important, and the industry that serves them is often overlooked by the broader healthcare industry. But what's unique about pet health services is, unlike human healthcare, it mostly requires cash payments -- bypassing the reimbursement issues and pricing pressure associated with third-party payers, not to mention it's less of a headache for your local veterinarian clinic.
An Opportunity In The Pet Care Market -- And How To Profit
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With all of this in mind, recently I've been spending a lot of time researching the dynamics of this industry and the best ways for investors to profit. I managed to identify a global leader in the animal health industry by using my premium investing system, Maximum Profit. It has a number of catalysts behind it, and the company is coming off a stellar quarter that should help propel shares higher.
The company is a leader when it comes to diagnostic equipment and practice management software, making customers likely to stick with the company long-term. It's also an innovator in the animal diagnostic market, allowing it to create better and more efficient products to help animal health clinics quickly diagnose illnesses in pets. This gives the firm a strong pipeline of new products and services it can cross-sell to its already devoted customer base as well as acquire new customers.
But rather than simply buy shares blindly, I applied the rigorous factors used by my system. You see, the Maximum Profit portfolio holds stocks that have been thoroughly vetted by my two thoroughly tested indicators. The system combines the two most powerful indicators from the worlds of technical and fundamental analysis to find winning trades. We've tested this system on everything from S&P 500 stocks to high-yield stocks to small-cap stocks.
The results are always the same: The Maximum Profit system beats traditional "buy and hold" investing with less risk.
Unfortunately, I can't give away the name of the stock to you today. It simply wouldn't be fair to my subscribers. But I can tell you the stock sports Maximum Profit score of 81. That means it's firmly a "buy."
Bottom line, I think I'm onto something here with looking into the animal pharmaceutical space. For those of you who enjoy doing your own independent research, this may prove to be a fertile ground for you as well.
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And while I plan to research this space further, my Maximum Profit subscribers and I are also excited about this new pick. If you'd like to get the name and ticker symbol of this pick -- as well as learn more about how my system works -- you can follow this link.
That's the beauty of this system -- it can be used to find stocks that are the most likely to beat the market and deliver gains in a shorter amount of time.
Since the inaugural issue of Maximum Profit, many of the picks have boasted gains of 39%... 46%... even 181% -- all in less than 13 months.
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