Could healthcare stock Advanced Medical Solutions (LSE:AMS) be a shrewd addition to my holdings? Let’s take a closer look at the pros and cons to help me decide.

Wound-care products

As a quick reminder, Advanced designs, develops, and manufactures advanced wound-care products for the healthcare market. It has a series of branded and non-branded products. Some products are designed for general use, while it also develops speciality products for surgical use too.

So what’s happening with the Advanced share price currently? Well, as I write, the shares are trading for 280p. At this time last year, the stock was trading for 284p, which is a 1% decline over a 12-month period. It is worth noting that the healthcare stock has pulled back 17% since the turn of the year, from 338p to current levels.

To buy or not to buy?

So what are the pros and cons of buying Advanced shares?

FOR: I like the look of Advanced’s business model and growth prospects. With its branded and non-branded revenue streams, it is able to make money from both divisions. Furthermore, it has a huge profile and presence and sells its products in over 80 countries. Elective surgeries took a major hit during the pandemic period but things have returned to normal. Advanced’s position as a leading wound-care product provider should be able to assist growth, boost performance, and in turn, any returns I would hope to make as an investor.

AGAINST: Current macroeconomic headwinds pose real risks for Advanced’s growth prospects and performance. Soaring inflation, the rising cost of raw materials, as well as the global supply chain crisis could have a material impact on the healthcare stock. Profit margins could be squeezed by rising costs and operations and sales could be affected by supply chain problems. My belief is that these issues are shorter term, and I invest for the long term.

FOR: I am buoyed by Advanced’s performance track record. I do understand that past performance is not a guarantee of the future. Looking back, I can see it has recorded consistent revenue and profit in the past four years. Most tellingly, however, I note that its 2021 performance was higher than pre-pandemic levels. This supports my theory that elective surgeries have returned to normal and Advanced’s growth prospects ahead look attractive.

AGAINST: One concern is the current valuation of Advanced shares. On a price-to-earnings ratio of just over 30, the shares look a tad expensive. Future growth may already be priced in. Furthermore, any bad news could make the share price tumble. I will keep a keen eye on developments.

A healthcare stock I would buy

Weighing up the pros and cons, the positives outweigh the negatives for me. For that reason, I would be willing to add Advanced Medical Solutions shares to my holdings. The firm’s profile, presence, and growth prospects look attractive to me. As a bonus, it pays a dividend too, which would likely boost my passive income stream.

The post Is this healthcare stock a no-brainer buy? appeared first on The Twelfth Magpie.

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Jabran Khan has no position in any shares mentioned. The Motley Fool UK has recommended Advanced Medical Solutions. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

There’s a lot going for the FTSE 100 index, which I’ve talked about in another article today. But there’s something to be said for caution, too. There are still potential roadblocks ahead.

Here are two of them:

#1. Continued corona-crisis

The vaccine rollouts are a huge positive, but what about the new virus variant in town? We still don’t know if it’s going to respond appropriately to the Covid-19 vaccines. And if it doesn’t, we have another problem at hand. 

Moreover, there are at least some people who are wary of the vaccine. If the number increases to a level that keeps virus levels high, that could be an additional challenge. 

#2. Brexit delays

Despite the Brexit deal being struck, there are still thorny issues to contend with. A news piece I read today, for instance, pointed to struggles faced by parcel courier providers because of more complex processes.  

Financial services is another area that needs resolution. And this is important, because of the large financial services industry in the country. 

While I hope that neither of these situations blows out of control, I think they do serve as a good reminder that we should still maintain some caution in our investments. 

To that end, I would still consider buying ‘safe’ stocks or those that can withstand stock market crashes better than others.

Here are three that I’d consider:

#1. AstraZeneca — FTSE 100’s Covid-19 star

This FTSE 100 pharmaceuticals biggie hasn’t just been a literal life-saver this year, it was also one of the best performing stocks in the months following the stock market crash. 

Like all others, it saw a dramatic fall in March, but by July it made big gains and was trading at all-time highs. It has seen a sharp reversal in fortunes since the stock market rally started in November, however, as investors flocked to beaten down stocks. It’s trading at levels 20% below its 2020 highs now. 

I think it’s a solid stock in any case, but even more so when I keep the risks of another market meltdown in mind. 

#2. Hikma Pharmaceuticals — improving performance

This is another FTSE 100 healthcare stock I like, and not just because it’s a defensive one.

It put out a positive guidance in November last year, and its share price is currently near all-time highs. Though with a price-to-earnings ratio of 12.5 times, I reckon that it can increase more. 

#3. Ocado — fortune-favoured share to buy

Much like AZN, OCDO too has seen subdued share prices since the stock market rally began.

But also like AZN, it has a lot going for it in terms of long-term prospects. With the continued lockdown, I think this FTSE 100 stock will continue to perform in the short term as online deliveries remain in demand, not something we can say for all businesses. 

The post Shares to buy: 3 reasons why I’d still love to buy these FTSE 100 stocks appeared first on The Twelfth Magpie.

More reading

• How much is needed in an ISA to unlock £1,220 of passive income a year?
• Forget meal deals! Here’s how £8 a day could be worth £357,000
• With a 7% yield, is this dividend share a no-brainer?
• The CMC Markets share price is smashing the FTSE 100 in 2026. Is there an opportunity here?
• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?

Manika Premsingh owns shares of AstraZeneca and Ocado Group. The Motley Fool UK has recommended Hikma Pharmaceuticals. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

In terms of healthcare stocks, British investors have many options. Whether you’re looking to invest in a large-cap FTSE 100 healthcare stock, or an under-the-radar small-cap healthcare stock, there are plenty of investment opportunities. With that in mind, here’s a look at some UK healthcare stocks I believe could be worth checking out if you want to invest in healthcare.

Large-cap healthcare stocks

In the large-cap area of the market (the FTSE 100), there are a number of prominent healthcare stocks. The largest is AstraZeneca. It’s a global, science-led biopharmaceutical company. It specialises in oncology (cancer), cardiovascular and metabolic diseases, and respiratory, inflammation and autoimmune diseases.

Then there’s GlaxoSmithKline. Its area of specialism is pharmaceuticals, vaccines, and consumer healthcare products. Recently, GSK reached an agreement with Pfizer to combine their consumer health businesses. The combined entity will be a market leader in pain relief, digestive health, and therapeutic oral health.

Also in the FTSE 100, there’s Smith & Nephew. It specialises in joint replacement systems and looks set to benefit from the world’s ageing population. And then there’s Hikma Pharmaceuticals, which manufactures branded and non-branded generic medicines.

Mid-caps

In the mid-cap space, there’s a handful of healthcare stocks that could be worth a closer look. One of the larger mid-caps is ConvaTec. It offers products and services in the areas of wound and skincare, ostomy care, continence, and critical care.

Another largish mid-cap healthcare stock is Mediclinic. It’s an international hospital group with operations in a number of companies across the world. Also in the mid-cap area, there’s UDG Healthcare. It provides advisory, communication, and packaging services to the healthcare industry.

Small-caps

In the small-cap area of the market, there are many options if you’re looking for healthcare stocks. I’ll point out, however, that some of these stocks are more speculative in nature. So a cautious approach is sensible.

One small-cap healthcare company that appears to have potential is EMIS. It provides software and information technology services to the healthcare industry. This means it’s a play on both health and technology.

Another smaller company that looks interesting in my opinion is Advanced Medical Solutions. Its area of focus is advanced wound care products and surgical dressings.

There’s also Alliance Pharma, which owns or licenses the rights to over 90 pharmaceutical and consumer healthcare products. It has grown significantly in recent years.

Some other small-cap stocks that could be worth a closer look include clinical trials company Ergomed, antibody specialist Bioventix, and radiology business Medica.

In conclusion, there are many different healthcare stocks listed in the UK. This means that there are plenty of ways to gain exposure to the sector. The key, as always, is to do your own research and diversify your capital across a few companies. This will give you the best chance of profiting from the sector in the long run.

The post Want to invest in UK healthcare stocks? Here are some companies I’d look at appeared first on The Twelfth Magpie.

More reading

• How much is needed in an ISA to unlock £1,220 of passive income a year?
• Forget meal deals! Here’s how £8 a day could be worth £357,000
• With a 7% yield, is this dividend share a no-brainer?
• The CMC Markets share price is smashing the FTSE 100 in 2026. Is there an opportunity here?
• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?

Edward Sheldon owns shares in GlaxoSmithKline and Smith & Nephew. The Motley Fool UK owns shares of and has recommended GlaxoSmithKline. The Motley Fool UK has recommended Advanced Medical Solutions, Alliance Pharma, AstraZeneca, Bioventix, Emis Group, Hikma Pharmaceuticals, and UDG Healthcare. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.