Marc Lichtenfeld is deeply entrenched in the investment world. Ask him a question about the economy, dividend stocks, foreign companies worth buying into, or Master Limited Partnerships (MLPs) and he’ll have a ready, intelligent and informed answer. That much is easily evidenced in his published articles this year alone, not to mention from years gone by.
But perhaps the financial topics he’s most passionate – and most well-versed – about, are the healthcare and biotech sectors. He has an entire service, FirstLine Investor Alert, which is built around such investment opportunities. In it, he does due diligence on dozens of companies every year, picking and choosing the best of the best for his subscribers.
FirstLine openly advertises its intentions to take advantage of the growing opportunities in the healthcare sector. With over 65 million Baby Boomers turning 65 over this decade and next, there will be plenty more need for everything from diagnostic tests to lab work, medicines to surgeries, and devices to services. And none of that includes all of the incredible medical ideas and alternatives being tested out even now, including regenerative medicine, DNA sequencing, cancer cures, diabetes treatments and numerous other lifesaving – and potentially portfolio-altering – techniques.
Based off of his research and connections, Marc truly believes in FirstLine’s possibilities as a service… and in the targeted sector’s growth opportunities in general. Early on this year, he went into more depth on the subject in an Investment U article:
Healthcare: The Sector You Must Be Invested in for the Next 10 Years
by Marc Lichtenfeld, Investment U Senior Analyst
Wednesday, January 4, 2012: Issue #1679
Wes Harris of Charlotte is going to have a heart attack in February. His blocked artery isn’t going to wait to see if Greece or Italy will default on its debt.
John Davidson of Oklahoma City is going into the hospital for a knee replacement next week. The surgery will happen no matter if the S&P is up, down, or sideways.
And Carly Nelson who lives in a suburb of St. Louis needs a mastectomy after breast cancer was discovered. She will likely start chemo several weeks later. Whether unemployment climbs back over nine percent will have no bearing on her decision about treatment.
These procedures and others save lives and improve quality of life. Millions of operations, tests and other healthcare services will happen regardless of world events, economic, political, or otherwise.
When people are sick, they’ll do anything in their power to get better. And it doesn’t matter one iota what else is happening on the planet.
It’s one of the reasons I love the healthcare sector.
Starting this year until 2030, 10,000 Baby Boomers will turn 65 every single day. And you don’t need a doctorate in demographics to know that older people consume more healthcare as they age.
That’s why $4 trillion is expected to flood into healthcare over the next eight years.
Super Bowl of Healthcare
While football players are gearing up for the playoffs, hoping to make it to the big game, I know that I’m already going. But the Super Bowl I’m talking about is in San Francisco, not Indianapolis, and it takes place a month earlier.
On Saturday I fly to California for the J.P. Morgan Healthcare Conference. It’s the most important and exclusive healthcare conference of the year. Typically, you need to manage millions of dollars to get a ticket to sit in on presentations and meet the CEOs of some of the largest and most innovative healthcare companies.
This is my sixth consecutive year attending the conference and it always generates a ton of new ideas.
Presentations are expected from the likes of Pfizer (NYSE: PFE), Celgene (Nasdaq: CELG) and AstraZeneca (NYSE: AZN), as well as some smaller companies like Incyte (Nasdaq: INCY), Illumina (Nasdaq: ILMN) and NuVasive (Nasdaq: NUVA).
I’m looking forward to hearing about the macro picture and how all of these companies plan on capitalizing on the millions of new patients and trillions of new dollars that are on the cusp of entering the system.
As a result, I’m particularly interested in diagnostics and genetic sequencing. We’re already at the point where doctors know that specific cancers will or won’t react to certain treatments based on genetic mutations. But we’re in the very early stages of this type of science. Within the next 10 years, by reading our genetic code, doctors will be able to understand so much more about what keeps us healthy and what makes us sick.
And in order to gather that information, medical professionals will need tools – machines, consumables, tests – in order to gather and interpret all of that data.
I expect diagnostics and medical technology to be huge winners not only in 2012, but over the next decade or so. The Oxford Club’s Investment Director Alexander Green has been bullish on medical technology for a while now, discussing it at length in The Oxford Club Communique’s 2012 Forecast Issue.
Interestingly, on New Year’s Eve, I had dinner with a health insurance executive, a surgeon and a computer programmer. For half of the evening, we talked about the changes technology is bringing to healthcare. It further confirmed what Alex and I have been saying for a while now. This sector is going to be huge.
Packed Calendar
The pace of the week is hectic. I’ll [be] at the conference every morning by 7:15 AM. Right now, the only holes in my schedule are Monday at 2:00 PM and Wednesday at 10:00 AM. Lunch and dinner are booked every day with fund managers and analysts.
Along with sitting in on presentations and breakout sessions, I have one-on-one meetings set up with several management teams, including the one from a tiny company with mind-blowing technology that’s on the verge of changing how new drugs are discovered.
I’ll report back to you next week in this column with some of my observations.
Meanwhile, if you’re as jazzed as I am about the prospects for the healthcare sector, let me know. When you provide your email address, you’ll be the first to hear about my new healthcare investing service, FirstLine Investor Alert, which is launching in the next week or two. And you’ll receive a special discount that’s only available to those who sign up on this hot list. You’ll be under absolutely no obligation. You’ll simply be notified first and save a significant amount if you do decide to try the service.
The healthcare sector is on the launch pad. The conference I’m attending always gives me some great ideas and new contacts to help my readers navigate the field to find the best profit opportunities.
With all of that money cascading into the healthcare sector over the next decade, medical stocks are going to take off with or without you. I hope it will be with you. And it’s taking place no matter what happens in Europe or the election.
I’ll talk to you next week.
Good Investing,
Marc Lichtenfeld
A Follow-up on the J.P. Morgan Healthcare Conference… and Marc’s Thoughts in General
Sure enough, Marc was as good as his word. The following Wednesday, January 11, he published another piece at Investment U entitled “Jamie Dimon’s Medicine to Cure America.”
In it, he reiterated his enthusiasm for the healthcare industry, both now and going forward. Though he flat-out admits that the J.P. Morgan Healthcare Conference usually has him feeling optimistic, it’s hard not to understand exactly why that is when he spent the entire time listening to brilliant presentations, speaking with first-rate scientists at the top of their game, and meeting with industry leaders who are overseeing amazing breakthroughs in medicine and medical technology… ones that might someday treat and even cure previously catastrophic diseases and medical issues.
Out of that extremely impressive list of activities, there was one event that stood out the most to Marc. And he consequently shared it with Investment U readers. As he put it, despite the remarkable advances and advancers on display all around him, “none of the doctors had a prescription for what’s ailing America and its economy.” Nobody except for Jamie Dimon, that was, the CEO of J.P. Morgan Chase (NYSE: JPM).
Apparently, Dimon – one of America’s most respected business leaders – sat down with CNBC’s Maria Bartiromo over lunch for a one-hour interview that Marc found “stirring.” Known for his bluntness, the CEO explained exactly why he sees the economic glass half full and discussed ways to fill it up even more. An enthusiastic and unapologetic capitalist, he completely disregarded the new age, Occupy Wall Street-reinforced taboo of wealth condemnation, and told his interviewer and the gathered medical-oriented audience that they “should feel pretty good about the lives” they save and shouldn’t have to hide shamefaced from whatever profits – big or small – they made in the effort.
But that might not have been the most shocking statement Marc recalled him making, because – despite the prevalence of negative economic opinions among the “little people” in America (i.e. Average Joe and Jane), Dimon shared his opinion that the United States was in a mild but still strengthening recovery across numerous sectors. And, he added, companies within the U.S. were in fabulous shape.
To back up that opinion, he noted two main points:
- The consumer debt ratio, which had returned to where it was two decades ago
- Housing supply and demand, which he saw as beginning to balance out once again
But as Marc put it, “it wasn’t all sunshine and rainbows. There’s a lot of hard work to do. Dimon’s recipe for getting America back on its feet is for executives to stop griping and work hard to build their companies regardless of the economic, geopolitical, or regulatory environments.”
That includes running stress tests like the banks have been required to do off and on ever since the global financial crisis first hit. But as for the global financial crisis itself, Dimon made it clear that businesses have no right to blame their failures on such factors, since there is always negative news out there to affect the markets somehow and someway. That’s just a fact of life that companies have to live with, complete with strategies on how to work through or around those issues.
Yet, understanding that the entire onus to turn around the country doesn’t belong on companies, Dimon tackled the tough topics of government involvement and regulatory power as well. For one thing, he made it very clear that he has no problem with lobbying, even going so far as to encourage fellow CEOs to allocate funds, resources and personnel to reaching out to Congress.
And if elected representatives don’t listen? Well then, he has the same words of wisdom concerning the economy: Suck it up and deal with it.
A Few Last Thoughts from the Conference
Basic business analysis aside, however, Marc is extremely bullish on the healthcare sector. And after attending the J.P. Morgan Healthcare Conference, he knows very well that he isn’t the only one out there to think that way. Now a regular, he’s been going to the exclusive gathering for six years now, but it was the 2012 edition that had more than 8,500 people in attendance… more than he’s ever seen there before.
Many of the presentations were standing room only, and some of them were so packed that anybody who didn’t arrive at least 10 minutes early were relegated to listen from the hallway. And from what he could pick up of the conversations around him, that large crowd of overall attendees have cash to burn, the desire to use, and the inclination to put it into healthcare investments.
Basing so much off of one single conference might seem silly, but it both is and it isn’t.
It isn’t because of the sheer number of people attending and exactly who they were. These people were rich, well-connected and well-experienced in making money off of healthcare and biotech stocks. They’re anything but uninformed on the subject and, as a general rule, they don’t throw their money around lightly.
Yet at the same time, it would be foolish to blindly invest in random healthcare stocks just because the sector has so much promise. And Marc has no intention of doing any such thing. He looks at the big picture, yes, but – like Dimon practically preached back in January – he also looks at each individual picture as unbiased and analytically as possible. There’s been more than one time where he’s told his subscribers to look forward to some promising new pick… right before yanking them away because of some new, unflattering or disconcerting data he’s uncovered on the company. He doesn’t believe in hype; he believes in quality that he can believe in.
Marc only recommends what he perceives as the best. And that’s a guarantee any FirstLine Investor Alert subscriber can take to the bank and back.