The current bull market just doesn't seem to want to stop.
Despite geopolitical tensions, inflation, rising oil prices, and a
myriad of other problems facing the market and the economy, stocks
keep rising. And more positive earnings news this season should
keep stocks heading in the right direction.
Now, they say a rising tide floats all boats, but that's not
entirely true. Those with severe structural damage may end up
sinking no matter how high the water rises. And that is exactly
what is happening in the health care sector. Most health care
stocks have logged impressive gains so far in 2011, but there are
some big-name health care stocks that can barely seem to break
even. And investors would be wise to trim this dead weight from
Here are seven health care stocks to sell:
Johnson & Johnson (JNJ)
Provider of consumer health care products
Johnson & Johnson
) is the first overweight health care stock to sell. Despite recent
gains, JNJ has barely broken even in the past 12 months, compared
to a gain of almost 15% for the Dow Jones Industrial Average. And
year-over-year quarterly earnings growth of -23% isn't persuading
potential investors either.
Merck & Co. Inc. (MRK)
Global health care company
Merck & Co. Inc.
) is up less than 2% in the past 12 months. And the stock has
declined 1% since the start of 2011, while the market has rallied
Zimmer Holdings Inc. (ZMH)
Designer, developer, manufacturer and marketer of orthopedic,
reconstructive, spinal and trauma devices, dental implants and
related surgical products,
Zimmer Holdings Inc.
), posted terrible quarterly earnings growth of -77.5% in its last
income statement. And the stock has only managed to squeak out a
mere 2% gain in the past 12 months.
Boston Scientific Corp. (BSX)
Medical device developer and manufacturer
Boston Scientific Corp.
) has experienced a stock decline of 4% since the start of 2011.
For fiscal year 2010, BSX posted a net profit margin of -14%.
Finally, quarterly revenue growth of -4% in its last income
statement is just another bad sign for potential investors in this
health care stock.
Amgen Inc. (AMGN)
Year to date,
) is up a measly 2%. And this biotechnology company has lost 3% in
the past 12 months. More importantly, with year-over-year quarterly
earnings growth of -4%, and with analysts projecting an 8-cent drop
for EPS compared to this quarter last year, investors would be wise
to avoid this health care stock.
Gilead Sciences Inc. (GILD)
) has declined 2% in the past 12 months. In its last income
statement, GILD reported quarterly revenue growth of -8%, as well
as quarterly earnings growth of -24%. The only thing investors
should do with GILD is sell.
Celgene Corp. (CELG)
Rounding out the list of health care stocks to sell is
). Over the past 12 months, CELG has declined 1%, compared to gains
by the broader markets. And it is down almost 2% year to date.
Finally, quarterly earnings growth of -18%, year over year, is
another reason to avoid this stock.