Five Defensive Stocks We Like Right Now

5 Defensive Stocks We Like Right Now

M-Asset

May has been a volatile month and investors continue to worry about the stock market. Fortunately, safe-havens in equities do exist with dividend-paying healthcare stocks that pay steady levels of income helping to stabilize returns. These value-oriented companies are well-suited to shelter portfolios from the uncertainty impacting markets.

Healthcare businesses have performed extremely well in 2022. The sector is growing faster than the U.S.
economy thanks to the unwavering demand for health-related products and services. Dependable, large-cap, dividend payers in this sector have delivered steady returns despite high inflation and rising rates.

Middlefield manages several healthcare focused strategies. Feel free to reach out to your Middlefield sales representative to learn more.

Fund ETF Ticker or F Series Code Investment Focus
Middlefield Healthcare Dividend ETF MHCD Global Healthcare Equity Income
Middlefield Global Healthcare Dividend Fund MID326 Global Healthcare Equity Income
Middlefield Health & Wellness ETF HWF Global Healthcare + Wellness Equity Income

The stocks highlighted below have shown a low correlation to the market and have fared better in terms of fundamentals, margins, supply chains and pricing power. They trade at reasonable valuations and provide investors defensive growth, high margins and attractive yields.

The following equities are held across all of Middlefield’s healthcare-focused ETFs and Mutual Funds.

Company Description Market Cap(USD) Yield Investment Highlights
Abbvie logo U.S. focused biopharmaceutical company with leadership position in immunology $270 Billion 3.7%
  • Recent launch of new immunology drugs exceeding expectations
  • Consistent outperformance from aesthetics division (botox)
Sanofi logo Healthcare company headquartered in France with pharma, consumer & vaccine businesses $130 Billion 3.3%
  • Trading at material discount to European pharma peers
  • Promising vaccine pipeline including a mRNA-based flu candidate
Gilead logo Global leader in HIV treatments with expanding oncology pipeline $80 Billion 4.6%
  • High gross margins underpinned by cashgenerating HIV business
  • Attractively valued with forward P/E multiple below 10x
Medtronic logo Global medical technology & equipment company selling device-based medical therapies $140 Billion 2.4%
  • Positioned in strong end markets across eight operating segments
  • Early stages of a transformational innovation cycle
Merck logo Global biopharmaceutical company focused on cancer drugs, vaccines and animal health $230 Billion 3.0%
  • Defensive earnings supported by world’s top-selling cancer drug
  • Significant capital deployment optionality over next 12-18 months
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Disclaimer

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund and ETF investments. Please read the prospectus before investing. Mutual funds and ETFs are not guaranteed, their values change frequently and past performance may not be repeated. You will usually pay brokerage fees to your dealer if you purchase or sell units of an investment fund on the TSX, or other exchange. If the units are purchased or sold on the TSX or other market, investors may pay more than the current net asset value when buying units of the investment fund and may receive less than the current net asset value when selling them. There are ongoing fees and expenses associated with owning units of an investment fund. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about the fund in these documents. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated. This document is for information purposes only and does not constitute an offer to sell or a solicitation to buy the securities referred to herein.

The opinions contained in this publication are solely those of Middlefield Limited (“ML”) and are subject to change without notice. ML makes every effort to ensure that the information has been derived from sources believed to reliable and accurate. However, ML assumes no responsibility for any losses or damages, whether direct or indirect which arise from the use of this information. ML is under no obligation to update the information contained herein. The information should not be regarded as a substitute for the exercise of your own judgment. Please read the Funds’ publicly filed documents before investing. Certain statements in this document may be viewed as forward-looking statements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, intentions, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “is expected”, “anticipates”, “plans”, “estimates” or “intends” (or negative or grammatical variations thereof), or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Statements which may constitute forward-looking statements relate to: the proposed timing of the conversions and completion thereof; the benefits of the conversions; and the funds that are proposed to be converted. Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements including as a result of changes in the general economic and political environment, changes in applicable legislation, and the performance of each fund. There are no assurances the funds can fulfill such forward-looking statements and the funds do not undertake any obligation to update such statements. Such forward-looking statements are only predictions; actual events or results may differ materially as a result of risks facing one or more of the funds, many of which are beyond the control of the funds.

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