Three best performing healthcare service providers average 3.7% YTD return

THE three best performing healthcare service providers on the Singapore Exchange’s All Healthcare Index have managed an average year-to-date (YTD) total return of 3.7 per cent.

On June 21, the local bourse said in a market update report that the three stocks, Aoxin Q & M Dental Group, IHH Healthcare, and Clearbridge Health, managed to bring in a total YTD return of 5.7 per cent, 4.1 per cent, and 1.4 per cent, respectively.

Aoxin Q & M Dental Group, IHH Healthcare, and Clearbridge Health are among the 14 constituent stocks, which are healthcare service providers that operate patient care facilities in Singapore and globally, in the SGX All Healthcare Index.

The 14 constituents have a combined market capitalisation of over S$20 billion. 

In the YTD, they have averaged a total return of -9.6 per cent, bringing their average total returns over the last 12 months and three years to -13.9 per cent and 8 per cent, respectively.

Among the 14 stocks, the three constituents with the highest dividend yields are HC Surgical Specialists (5.3 per cent), Singapore O&G (4.4 per cent), and ISEC Healthcare (4.1 per cent). 

They averaged a yield of 4.6 per cent. This compares with a dividend yield of 4 per cent for the benchmark STI, the report said.

In terms of return on equity (ROE), the three constituents with the highest ROE among the 14 are Talkmed (38.5 per cent), Q & M Dental (20.7 per cent), and Singapore O&G (20 per cent), which averaged an ROE of 26.4 per cent.

“With the region’s healthcare spending levels poised to increase in coming decades, healthcare plays that derive significant revenues from geographies beyond Singapore are set to benefit,” the report said.

According to SGX, during the first five months of this year, Singapore’s healthcare sector was the fourth-best performing segment, generating a 9.5 per cent total return over the period. 

The sector has chalked up eight consecutive months of positive returns since October 2017, with the highest return of 5.8 per cent registered in January 2018.

The SGX All Healthcare Index is a free-float, market capitalisation-weighted index that measures the performance of Singapore’s listed healthcare sector.

In the 2018 year-to-date, the index, which comprises 31 constituents, has generated a total return of 4.8 per cent, outperforming total returns of -0.9 per cent and -1.6 per cent for the benchmark Straits Times Index and the broader FTSE ST All-Share Index, respectively.