Health and Healthcare

Merrill Lynch's Top Health Care Stock Picks for 2015

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Merrill Lynch released its report looking forward to 2015 and which stocks it believes will outperform in the health care sector. In 2014, many of these same companies had very strong performances and are finishing the year strong.

24/7 Wall St. has compiled the list of these stocks from the Merrill Lynch report that are expected to be top performers in 2015.

Actavis PLC (NYSE: ACT), a specialty and tax-inverted pharmaceutical, is rated as a Buy by Merrill Lynch. Three years of outperformance and growth have positioned the company to execute its plans going forward. Shares of Actavis were up 1% at $266.44 in the second half of the trading day Friday. The stock has a consensus analyst price target of $304.72 and a 52-week trading range of $161.92 to $272.75.

Perrigo Co. PLC (NYSE: PRGO) is another specialty pharmaceutical company that has a Buy rating for also being tax-inverted. Merrill Lynch sees this company as morphing into a top-five global OTC firm. Shares of Perrigo were up over 2% at $169.15. The consensus analyst price target is $180.07, and the 52-week trading range is $125.37 to $171.50.

Merck & Co. Inc. (NYSE: MRK) is considered by Merrill Lynch to be well positioned in the major pharma sector to outperform despite expecting slowed momentum for the sector in 2015. It remains a Buy in the analyst company’s book. Shares of Merck were up less than 1% at $59.39. The stock has a consensus price target of $63.92, and its 52-week trading range is $48.63 to $62.20.

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Celgene Corp. (NASDAQ: CELG) is the large-cap biotech pick for Merrill Lynch and remains a Buy. It is known as one of the highest growth large-caps with a diverse and robust pipeline capable of supporting future growth. Shares of Celgene were up less than 1% at $117.23. The consensus price target is $116.68. The 52-week trading range is $66.85 to $119.84.

Karyopharm Therapeutics Inc. (NASDAQ: KPTI) is the small-mid-cap biotech pick for the analyst firm and is rated as a Buy. Its key product Selinexor has a broad mechanism of action that can potentially show efficacy across several cancer indications. Shares of Karyopharm were up 1% at $36.53. The stock’s consensus price target is $55.17, and it has a 52-week trading range of $21.13 to $49.01.

Thermo Fisher Scientific Inc. (NYSE: TMO) is rated at Buy, considering that there is expected to be more consolidation within the sector, following the significant amount it had in 2014. Also Merrill Lynch believes that the company can outperform as capital deployment reaccelerates. Shares of Thermo Fisher were up almost 1% at $128.54. The consensus analyst price target is $140.75. The 52-week trading range is $107.33 to $129.77.

Medtronic Inc. (NYSE: MDT) investors will need to be more selective going forward in 2015 as the company’s merger in 2014 was the driver for its outperformance. Merrill Lynch rates the company as a Buy for its relatively low risk earnings per share growth outlook and potential for significant dividend growth. Shares of Medtronic were down less than 1% at $74.23. The stock has a consensus analyst price target of $80.06, and shares have traded in a 52-week range of $53.33 to $75.31.

Cigna Corp. (NYSE: CI), compared to its peers, is expected to face the least headwinds and is in a good position to grow, according to Merrill Lynch. The firm rated the company as its top pick for 2015, as it is trading at a 2.6-times discount to its peers. Although the company has underperformed the group year-to-date from poor Health Segment results, Merrill Lynch believes the company is positioned to outperform going forward. Shares of Cigna were up less than 1% at $104.90. The stock has a consensus analyst price target of $109.18 and a 52-week trading range of $73.47 to $105.60.

ALSO READ: Credit Suisse Sees 2 Biotech Stocks That Could Double in 2015

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