Author: Bob Freedland
Covestor model: Healthcare
Disclosures: Long HSTM, ISRG, LLY, SRCL, ABT, ALXN, BIIB, HMSY, MCK, MDCO, MWIV, PRGO, SHF, SXCI
It is unnecessary to point out to anyone that healthcare has been under intense examination in the wake of the Supreme Court ruling on the Constitutionality of the Affordable Care Act (Obamacare) this past month.
With the Court upholding the Act as Constitutional, there’s a bit more certainty in the sector. And it’s now easier to pick winners and losers.
I was able to perform quite well against the overall Covestor Universe in terms of the prior 90 day performance. And I did so with little trading activity.
While it pays to be smart, as it has been said, it is better to be lucky.
Changes in the model this month included the return of Healthstream (HSTM) early in June. The stock has performed nicely since I added it back into my mix of holdings.
I once again bought Intuitive Surgical (ISRG), maker of the DaVinci robotic surgery system. This stock also was very strong during the past month. That contributed to the overall strength of the portfolio.
Unfortunately, I sold my shares in Eli Lilly (LLY) during the month on weakness early June. This pharmaceutical firm continued to rebound and moved several points higher during the month (even without me!).
The other new position for me for this Model is Stericycle (SRCL). It appeared to represent good value and technically appeared to be rebounding from a correction. The stock has moved higher during the month and added to the model’s performance.
Many of the holdings in this model did well last month including Abbott (ABT), Alexion Pharma (ALXN), Biogen Idec (BIIB), HMS Holdings (HMSY), McKesson (MCK), The Medicines Company (MDCO), MWI Veterinary Supply (MWIV), Perrigo (PRGO), Schiff (SHF), and SXC Health Solutions (SXCI).
From big pharma to niche and orphan pharma, to pharmaceutical distribution, veterinary supplies, generics, vitamins and supplements, as well as pharmacy benefit management companies, the model represents many different investing themes and sub-sectors within the healthcare field.
I will continue to monitor each holding as I do with my Buy and Hold model, selling each on technical weakness or fundamental problems.
