Since the end of 2019, the Health Sector has been the second strongest segment of the global stock market, closely following the performance of the Tech Sector. Health Stocks make up approximately 10 per cent of global market capitalisation.
Singapore’s 10 most traded Health Stocks in the 2020 year to 11 Feb averaged S$26 million a day in combined turnover, while generating 13% median gains and average gains of 36%. The same 10 stocks averaged S$7 million daily turnover and a decline of 1% in 2019.
The 3 most traded Singapore healthcare-related stocks in the 2020 year to 11 Feb, include Medtecs International, First REIT & UG Healthcare. Medtecs International and UG Healthcare have also been amongst the strongest performers of Singapore’s health care stocks for the period.
Healthcare stocks across Asia Pacific have begun 2020 on a firm defensive note with the caution and concerns on the outbreak of the Covid-19 Coronavirus in China.
There are between 1,500 and 2,000 healthcare-related stocks listed across the Asia Pacific. These stocks have generated median gains of 3%, with an average return of 8% for the 2020 year through to 11 February. Globally, the Healthcare Sector has been the second best performer in early 2020, closely following the returns of the Technology Sector, whilst the Energy Sector was been the least performer.
In Singapore, the Healthcare Sector, as represented by the iEdge SG All Healthcare Index, has also generated an 8% total return in the 2020 year through to 11 February. The 10 most traded Healthcare-related stocks ranked by turnover in the 2020 year through to 11 February, which are also a part of the iEdge SG All Healthcare Index, are tabled below.
| Stock | SGX Code |
Market Cap S$m |
Total Return 2020 YTD % |
Total Return 2019 % |
30 Day Ann Volatility % |
Biggest Revenue source in Most Recent Annual Report |
P/E | Average Daily Turnover S$M |
|---|---|---|---|---|---|---|---|---|
| Medtecs Intl | 546 | 60 | 197 | 37 | 325 | Manufacturing | 47 | 12.13 |
| First REIT | AW9U | 796 | 2 | 10 | 11 | Indonesia Properties | 17 | 2.54 |
| UG Healthcare | 41A | 54 | 96 | -34 | 305 | Latex Examination Gloves | 31 | 2.22 |
| Raffles Medical | BSL | 1,883 | 3 | -7 | 25 | Hospital Services | 29 | 2.19 |
| ParkwayLife REIT | C2PU | 2,172 | 9 | 32 | 21 | Healthcare Property | 14 | 1.44 |
| Clearbridge | 1H3 | 96 | 20 | -17 | 49 | Laboratory testing | N/A | 1.33 |
| Riverstone | AP4 | 800 | 17 | -17 | 70 | Gloves | 18 | 1.29 |
| Thomson Medical | A50 | 1,586 | -6 | -12 | 31 | Hospital Ops & Ancillary Serv. | N/A | 1.06 |
| Healthway Med | 5NG | 149 | 27 | -19 | 152 | Primary Healthcare | N/A | 0.96 |
| Haw Par | H02 | 2,708 | -4 | 15 | 11 | Healthcare Products | 14 | 0.65 |
| Median | 13.0 | -9.4 | ||||||
| Average | 36.2 | -1.2 |
Source: SGX StockFacts, Thomson Reuters, Bloomberg (Data as of 12 February 2020), note First REIT and ParkwayLife REIT total returns include dividend distributions.
Of the 10 stocks tabled above, the three stocks that generated the strongest volatility-adjusted returns in 2020 through to 11 February included Medtecs International, ParkwayLife REIT and Clearbridge Health.
The 10 most traded healthcare stocks for the 2020 year through to 11 February have seen combined turnover of S$26 million with S$35 million of net retail inflows. The average daily turnover for these 10 stocks is up close to threefold, from S$7 million in 2019. Four of the 10 stocks, Medtecs International, UG Healthcare, Clearbridge Health and Healthway Medical Group are listed on the Catalist board.
The 10 stocks tabled above also maintain valuations in-line with regional peers. Across Asia Pacific, the median Price-to-Earnings (P/E) ratio for the 70% of Healthcare stocks that maintained positive earnings is 24x. Similarly, the 7 of the 10 stocks tabled above with P/E ratios average a ratio of 23x.
Top Glove Corporation, which has averaged S$522k in daily turnover in the 2020 year to date, was the next most traded Healthcare stock outside of the 10 stocks tabled above. The leading manufacturer of disposable rubber gloves has generated a 24% price gain over the period, following on from a decline in total return of 14% in 2019. IHH Healthcare by comparison has averaged a 3% gain in the early 2020 year, following on from a 4% total return in 2019.
First REIT and ParkwayLife REIT recently reported their FY19 results. ParkwayLife REIT (click here) reported a 2.5% increase in its FY19 distribution per unit (“DPU”), whilst First REIT (click here) maintain the same DPU in FY19 as FY18. ParkwayLife REIT has a portfolio of 53 quality healthcare and healthcare-related properties in Singapore, Japan and Malaysia, while First REIT’s portfolio consists of 20 properties located in Indonesia, Singapore and South Korea.
