The portfolio managers of the $1.2 billion Eaton Vance Worldwide Health Sciences fund are expecting big gains from a trio of healthcare stocks.
Jason Kritzer and Samantha Pandolfi, co-managers of the fund, highlighted Vertex Pharmaceuticals, Zoetis and Shire for future outperformance in an article in Barron's.
Kritzer said he expects to see Vertex increase its revenue by at least 20 percent in 2017 and 30 percent in 2018, with per-share profit potentially doubling this year and again next year. He sees the stock price rising to "between $152 and $155."
Vertex closed at $130.99 on Friday.
Pandolfi says she sees 15 percent upside for drugmaker Zoetis and 40 percent upside for Dublin-based drugmaker Shire.She said Shire's stock price has been held back by investor concerns the company is losing ground to other manufacturers of hemophilia drugs, which Shire relies on for a large portion of its annual revenue.
"If the hemophilia fears persist, it could take two to three years to deliver those returns," she said. "If the fears abate, it will happen sooner."
The pair said that the pharmaceutical and biotechnology industries have been proactive in the face of uncertainty surrounding the possible repeal of the Affordable Care Act, noting also that "The leaked draft executive order on drug pricing reads favorably for industries. With repeal and replace [of the Affordable Care Act], depending on how things shake out, hospitals are the big losers long term, due to cuts in Medicaid."
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