With the stock market indexes in a correction, managed health care leader Anthem earns a spot on the latest list of new buys by the best mutual funds. Fellow medical and Big Pharma stocks UnitedHealth, AbbVie, Bristol Meyers Squibb and AstraZeneca also made the list.
While no stock has immunity from a market sell-off, medical sector stocks have fared better than most. Solid stock ratings and market-leading relative strength lines reflect that resilience.
With a 97 Composite Rating, Anthem scores top billing in the managed medical care industry group. Centene, Humana, Molina Healthcare and Cigna are also among the industry group leaders.
The market correction has shrunk the number of stocks on IBD Leaderboard to just five, with Anthem and Eli Lilly among them.
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Anthem Maintains Stable Earnings Growth
Headquartered in Indianapolis, Anthem provides managed health care services through Preferred Provider Organization (PPO), Health Maintenance Organization (HMO) and other hybrid plans. The company serves more than 118 million people, including more than 45 million within its family of health plans.
Anthem reported Q1 earnings on April 20, topping analysts' estimates with an 18% rise to $8.25 per share. With a $118 billion market value, the megacap has an impressive 5-year EPS growth rate of 19%.
Anthem registers a strong 5-Year Earnings Stability Factor of 7. The lower the number shows a more stable earnings on a scale from 1 to 99,
ANTM Stock Tests Support At 50-Day Line
After CEO Gail Boudreaux took home the 2022 NCAA Theodore Roosevelt Award. Anthem was featured in this column on Feb. 28. At the time, ANTM stock was trying to retake a 470.12 buy point.
The stock went on to clear that entry and hit a new high last month before pulling back as the market weakened.
Anthem has now pulled back to test support at its 50-day moving average. , closing right around that line on Monday. Volume on the pullback has been light, a sign that large investors are not selling aggressively.
The relative strength line remains around a new high. Unlike with many stocks, particularly growth and tech companies, Anthem's 50-day line has stayed solidly above its longer-term 200-day benchmark, a sign of technical strength.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
