Watching the values of the firms you own plummet abruptly over a short period may be devastating. Many investors may want to retreat to healthcare stocks that have demonstrated success in order to stabilize their portfolios as equity markets have become increasingly turbulent recently.
Investing in strong companies does not always imply stodgy, old firms with no future prospects. Omnicell (OMCL), Orthopediatrics (KIDS-2.03%), have shown long-term revenue growth while also rewarding investors in the process. These deserve attention from investors while effectively filling a much-needed area of healthcare system.
Omnicell, which sits at the intersection of labor shortages, automation, and an eternal quest for higher patient results, is a leader in pharmacy management software. Its pharmacy management systems are designed to automate time-consuming manual labor and reduce administrative responsibilities. Furthermore, its equipment and software solutions increase productivity while lowering medication mistakes and waste.
Hospitals are a big fan of the company’s healthcare solutions business, which ended fiscal 2021 with $1.2 billion in sales and is projecting $1.37 to $1.43 billion in revenue for fiscal 2022 even having a lot of room for expansion. The company estimates that its addressable market pie is $70 billion across all of its operations. Hospitals like Omnicell’s product, as it has an outstanding customer retention rate of over 99%. In addition, it has a massive backlog of orders — $1.25 billion to finish out 2021, up from $924 million at the end of 2020.
Parents and healthcare professionals are well aware that the phrase “kids will be kids” may imply rambunctious play. And, on rare occasions, it can lead to injuries like fractured bones. Orthopedics has solutions that are distinct to this patient population, which is why orthopedic surgeons previously had to repurpose adult equipment. This surgical supply business specializes in pediatric orthopedic devices, with child-sized implants for pediatric procedures.
Since its IPO in October 2017, shares have increased just under 200% compared to 78% for the S&P 500. Revenue has been solid since then, with an average growth rate of approximately 21 percent each year. Orthopediatrics is a dependable performer that you may set and forget because it’s a first-mover with a solid foothold in its specialized market. This appears to be as good a time as any to add it to your watch list, down just under 25 percent from its 52-week high.