Every investor has a view on how to invest. As such, an investment solution for one person may not be suitable for anyone else. It’s always important to keep this in mind when buying stocks and shares.
I believe the best shares to buy now can be found in the pharmaceutical sector. I think that no matter what happens to the global economy over the next five to 10 years, there’ll always be a growing need for healthcare and treatments. Not just for humans, but animals as well. That’s why my money’s on the three companies listed below.
The best shares to buy now
The top company on my list is Dechra Pharmaceuticals (LSE: DPH). The business is one of the world’s largest producers of veterinary products, including food.
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Its growth over the past few years has been nothing short of outstanding as this market has ballooned. Earnings per share have grown at a compound annual rate of 24% since 2015.
Of course, there’s no guarantee this performance will continue indefinitely. The company faces multiple challenges, such as competition and regulatory headwinds. If it’s not investing enough every year, competitors could steal a march on the business, costing it market share and compressing profit margins.
Even after taking these challenges into account, I think this is one of the best shares to buy now to invest in the animal healthcare sector. That’s why I’d buy the stock for my portfolio today.
Undervalued
Another company I’d buy for my portfolio is Indivior (LSE: INDV). However, this company is an incredibly risky proposition, so it’s probably not suitable for every investor.
Indivior is a specialist pharmaceuticals business treating opioid addiction. During the past few years, legal battles regarding the misselling of these treatments have swamped the company. In the middle of last year, it drew a line under these issues by agreeing a final $600m settlement with the Department of Justice (DoJ). Unfortunately, the group was then sued by its former parent Reckitt for $1.4bn to cover the latter’s own settlement with the DoJ.
Despite these challenges, the company is profitable. This is why I’ve highlighted Indivior as one of the best shares to buy now despite the risks and challenges above. Based on current estimates, the stock trades at a forward P/E of 8.7 for 2022, compared to the sector average of 18.
While these are just estimates, I think they illustrate Indivior’s potential. That’s why I’d buy the stock today.
Income investment
The final healthcare stock I’d buy is GlaxoSmithKline (LSE: GSK). One of the UK’s top income stocks, shares in this pharma giant currently offer a dividend yield of around 6%. This level of income looks incredibly attractive in the current interest rate environment. However, it’s by no means guaranteed.
The pandemic has impacted the company’s outlook as routine vaccination programmes around the world have been postponed. As a result, there’s been talk of a dividend cut. The stock has also dropped on the organisation’s deteriorating outlook.
Nevertheless, as one of the largest pharmaceutical businesses in the UK, I think GlaxoSmithKline is a great way to invest in the healthcare sector. Therefore, I’d buy the stock for my portfolio today, despite current headwinds.
