Thursday, November 19, 2015

Is Becton, Dickinson And Company Poised To Continue Double-Digit Returns?

The healthcare industry is poised to continue to grow as the population continues to age. The unfortunate side effect of growing older is that your healthcare expenses tend to rise. A study from 2004 analyzed the medical expenses of a cross-section of users found that almost half of lifetime healthcare expenses are incurred once you reach 65+.

With "Baby Boomers" retiring daily, this will lead to a rather large increase in the number of individuals aged 65 and over each year. There are currently around 45 million Americans over the age of 65, and that number is expected to increase to over 83 million by 2050. The most rapid growth in that segment of the population is expected to occur over the next 10-15 years, with slower, but consistent, gains each year until 2050. Here's how this population is expected to grow, based on a 2014 report from the Census Bureau. (click to enlarge) Forecast Annual U.S. Population Aged 65+ Through 2050

One of my goals for this year was to increase my portfolio's exposure to the healthcare industry. Currently, my portfolio consists of just three healthcare companies that account for 8.7% of my investment capital and 6.4% of my forward 12-month dividends. Ideally, I'd like to get that to between 15-20% of both capital and dividends, so there's a lot of work to do on that front.

Continue reading the Becton, Dickinson & Company stock analysis on Seeking Alpha.

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  1. I think the health care industry will continue to be one of the 3 best industries to invest in over the long run (My other 2 favorites are insurance and consumer staples). Nice write up!

  2. BDX has been with me since 2008 with no plans to sell. Like the comment above I agree that pretty much anything 'health' has a long term tailwind behind it. I plan to add to my BDX when valuations permit. Right now the focus on another health segment, the REITs. Thanks for sharing.