Healthcare remains a highly attractive sector, supported by a tidal wave of innovation in both therapeutics and the provision of healthcare services
BB Healthcare team is now building up on 2017 outperformance (+4.9%, despite currency headwinds) and asset growth
Expect 2018 stocks' performance to be driven more by fundamentals (and M&A), less by political issues (tax reforms, Obamacare repeal)
BB Healthcare portfolio best positioned to capture the strongest emerging themes in healthcare, across bio-pharma, services, wellbeing
Reiterated commitment to returning capital via yearly dividends of 3.5% of NAV
As discussed in our initiation note, BB Healthcare decided not to hedge their currency exposure. Considering that their exposure to the USD is likely to be much higher than the benchmark global healthcare index, their FY 2017 performance was correspondently over-penalized by the sterling weakness. However the Trust follows a bottom-up approach with an investment horizon of 3-5 years, and we believe that management is rightly focusing on key industry themes and fundamentals rather than short-term currency volatility.
Full report is available via Capital Network website
Leverage at the end of February 2018 stood prudently at 7.3%, well within the expected long-term 5-10% range.