McKesson Corp (MCK-N)

Is surprised the stock hasn't split. Is one of the strongest stocks out there and plays a valuable role in society, though Washington disagrees.

One of the biggest distributors of branded or generic drugs, and offers surgical supplies. He expects this sector to boom if Trump messes with the pharma supply chain.

Certainly some stocks are less vulnerable to issues involving tariffs. What comes to mind are healthcare companies. You could look at some of the beaten-down companies that really didn't do well last year, as they're doing quite well today. Try this name, which he owns.

It is a large distributer of drugs which is a volume based business and has low margins. It is not expensive.

15% EPS growth rate, but paying only 17x forward PE. So PEG ratio is 1.1x, fairly cheap. Long-term, aging demographic trends give long runway for growth. 200-day and 200-week MAs are pushing higher. Outpacing S&P 500 since early 2019.

Growing at double-digits and trading around 19x PE. Much growth, a third, comes from the weight-loss drugs, mostly from LLY and Novo Nordisk. An aging population will need more medications.

US healthcare has been a minefield. Management lowered guidance, stock drew down sharply. But then it had a great quarter and shares rallied. #1 market share. Demographic and morbidity tailwinds. Still likes.

Earnings today impressed the market. Trades around 16-17x forward PE, 11-12% EPS growth rate. PEG ratio is 1.4x, pretty good. Great, long-term secular growth name. Few competitors plus 33% market share means substantial pricing leverage.

It was getting pricey, so he took profits around $616. He's holding, because of a strong long-term outlook. Are fueled by the weight-loss drugs and other pharmaceuticals, of which they are the largest U.S. distributors.

Drug distribution is a really low-margin business, which gives you less tolerance throughout your whole business. In US healthcare, they're always looking for ways to squeeze out value for consumers. Not a lot of avenues for growth.

Healthcare space provides nice combination of growth with stability, in case we get into latter stage of economic cycle. 

Got stopped out when it gapped lower. You need only 20 positions to be diversified; you don't want to look like the index. If something isn't behaving as you expect, based on what you know, step aside and let things develop.

Broken down technically. Well below 200-day MA, which has rolled over. Has work to do, wouldn't put money here today. Others in the sector are doing better.

Frustrating backslide, but continues to believe in it. #1 player in a 3-player oligopoly. A need, not a want. Demographics of aging and morbidity trends are tailwinds. #9 position on the Fortune 500 is very secure. Pullback due to short-term headwinds of lower revenue in one small unit plus drug going off-patent. Rexall sale is a blessing, as it was a drag on performance.

Dividend has grown at 10% compound rate over 10 years, will continue. Trades at 14x earnings, likely to grow at 11-12% over next 3 years. Opportune entry point.

Just below 200-day MA. One of 3 members of an oligopoly, which together control 90% of the business out there. Steady earnings, decent valuation. 15-16x forward PE, steady 11-12% growth rate. Value here, even though it's a growth name. As people age, volume of drugs required can only increase, benefiting a name like this.

He also owns CAH.

Very good franchise. Earnings growth about 17%, probably about the same next year. Dividend growth in the teens, attractive. Cautious on healthcare because of the US election cycle; it's an easy target. Very predictable business.

In US healthcare he owns LLY, REGN, and MCK.