Health care has lagged the top sectors in the S&P 500 over the past year, but it is starting to catch up and some nice moves in the big pharmaceutical and the biotech stocks are helping to drive the gains. As we have mentioned on several occasions, investor concern over politicians’ efforts to target drug pricing ignited the headwinds that hurt the sector, and many of those concerns appear to be dissipating.

A new Jefferies research report features the firm’s top picks in order of preference, and one top company stays in the top position. Here are the top five picks, and of course, all are rated Buy at Jefferies.

AbbVie

This stock remains the top global pharmaceutical stock pick at Jefferies. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. The company’s mission is to use its expertise, dedicated people and unique approach to innovation to develop and market advanced therapies that address some of the world’s most complex and serious diseases. AbbVie employs more than 26,000 people worldwide and markets medicines in more than 170 countries.

One of the biggest concerns with AbbVie is what eventually might happen with anti-inflammatory therapy Humira, which generated $14 billion in sales in fiscal 2015. That was the most any drug has recorded during a single year and represents a gigantic part of the company’s overall earnings. The problem is that biosimilars and generics are itching to enter the market with Amgen leading the charge, and some Wall Street analysts project that AbbVie may have a difficult time stopping that trend.

The patent board recently instituted Coherus BioSciences’ Inter Partes Review against the Humira ‘135 patent. The outcome of the review is expected in 12 months. While most analysts remain positive on Humira duration, the expected litigation uncertainty could continue to create an overhang on the stock.

AbbVie investors receive a 3.45% dividend. The Jefferies price target for the stock is $90, and the Wall Street consensus target is $70.17 Shares closed Thursday at $68.10.

Eli Lilly

This top company remains the number two pick at Jefferies. Eli Lilly and Co. (NYSE: LLY) is a global health care company with numerous core products in a number of primary-care pharmaceutical markets. The company generates revenues from its pharmaceutical product and animal health segments.

The product portfolio includes Zyprexa (for schizophrenia and bipolar disorder), Gemzar (pancreatic cancer), Evista (osteoporosis), Cymbalta (depression), Cialis (erectile dysfunction), Strattera (attention deficit hyperactivity disorder), Erbitux (cancer) and Alimta (chemotherapy). Eli Lilly also has a strong presence in the diabetes market.

The company reported second-quarter results that beat the consensus numbers on the top and bottom lines and reiterated its full-year guidance.

Shareholders receive a 2.5% dividend. Jefferies has a $105 price target. The consensus target is $96.81, and shares closed Thursday at $82.59.

Novartis

This is among the world’s largest pharmaceutical drug makers by sales and remains the number three pick at Jefferies. Novartis A.G. (NYSE: NVS) develops, manufactures and markets a range of health care products worldwide. It operates through three segments. The Pharmaceuticals segment offers patented prescription medicines for oncology, neuroscience, retina, immunology and dermatology, respiratory, cardio-metabolic, established medicines and cell and gene therapies.

The Alcon segment provides eye care products, including ophthalmic surgical equipment, instruments, disposable products and intraocular lenses; medicines to treat chronic and acute diseases of the eye and over-the-counter medicines for the eye; and contact lenses and lens care products.

The Sandoz segment offers generic prescription medicines that include active ingredients and finished dosage forms of pharmaceuticals for dermatology, respiratory and ophthalmic, cardiovascular, metabolism, central nervous system, pain, gastrointestinal and hormonal therapies; active pharmaceutical ingredients and intermediates primarily antibiotics; protein or other biotechnology-based products; and cytotoxic products for the hospital markets, as well as biotechnology manufacturing services to other companies.

Novartis investors are paid a 2.78% dividend. The Jefferies price target was not set in U.S. dollars, The consensus target, however, is posted at $93.25. Shares closed most recently at $82.90.

GlaxoSmithKline

This top global pharmaceutical could offer outstanding total return for investors as a solid portfolio holding, and it remains at number four. GlaxoSmithKline PLC (NYSE: GSK) offers pharmaceutical products in the therapeutic areas, including respiratory, anti-virals, central nervous system, cardiovascular and urogenital, metabolic, anti-bacterials, and emesis, dermatology, rare diseases, immuno-inflammation, vaccines, and HIV. It also provides consumer healthcare products in wellness, oral health, nutrition, and skin health areas.

Last year the company announced that the dividend would stay at its current level through 2017, a solid pledge for those seeking security. Also, the FDA approved the company’s Nucala add-on product for severe asthma with a very broad label. In addition, its ViiV Healthcare unit also reported promising data for its HIV treatments. GlaxoSmithKline plans to submit up to 20 new regulatory filings within the next five years, which confirms a very strong pipeline.

GlaxoSmithKline investors receive a 4.85% dividend. The consensus price objective is $48.67. The shares closed Thursday at $45.08.

Zoetis

This company rounds out the top five and also remains in its spot. Zoetis Inc. (NYSE: ZTS) engages in the discovery, development, manufacture and commercialization of animal health medicines and vaccines for livestock and companion animals in the United States and internationally.

The company offers anti-infectives that prevent, kill or slow the growth of bacteria, fungi, or protozoa; vaccines, which are biological preparations to prevent diseases of the respiratory, gastrointestinal and reproductive tracts or induce a specific immune response; and parasiticides that prevent or eliminate external and internal parasites, such as fleas, ticks and worms.

It also provides medicated feed additives that offer medicines to livestock; veterinarian solutions for anesthesia, pain management and the diagnosis of diabetes; and other pharmaceutical products, including pain and sedation, oncology, antiemetic, allergy and dermatology, and reproductive products. In addition, it offers other product categories comprising nutritionals and agribusiness services, as well as products and services in complementary areas consisting of biodevices, diagnostics and genetics.

Shareholders are paid a small 0.75% dividend. The $60 Jefferies price target compares with the consensus target of $53.83. The shares closed Thursday at $51.41.

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Any of these top picks make good sense for long-term growth and income portfolios. As August and September are the months most likely for a downturn in the markets, investors may want to scale in capital now.

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