Tag Archives: PRLB

Best Heal Care Stocks To Invest In 2019

Anyone who was smart enough to buy Netflix (NASDAQ:NFLX) at its IPO in 2002 and hold until today is sitting on a gain of 27,430%. That’s a high enough return to turn a small amount of money into life-changing wealth.

So, which stocks do we think are capable of delivering gains like that for shareholders who buy today? We asked a team of investors to weigh in, and they picked following stocks.

Best Heal Care Stocks To Invest In 2019: Intuitive Surgical Inc.(ISRG)

I own  Intuitive Surgical (NASDAQ:ISRG), and in front of my gathered fellow Heels last week, I put Intuitive Surgical on this list, as well, so I present it for you again today. It reminds us to continue to add to our winners. It was a winner a year ago. It had a three for one stock split, something that I don’t personally care about. I don’t think we should spend a lot of time talking about stock splits. I realize some people think they’re exciting or are confused by them.

I’ll just point out that Intuitive Surgical, which has split a few times over our nearly 15 years of acquaintance. I like that stock just as much today, over the next 15 years, as I did 15 years ago. In fact, Intuitive Surgical is more clearly in the lead with more resources today than it was 15 years ago.

This is a company that spends about $250 million a year just on R&D inventing the future. A lot of upstart competitors would dream of having that as their revenues or, even more, their profits. Well, Intuitive Surgical is spending that much just on R&D. Love the company and I look forward to an increasingly minimally invasive future.

Best Heal Care Stocks To Invest In 2019: Proto Labs, Inc.(PRLB)

Finding the next Netflix isn’t going to be easy, but patient investors who are willing to stick around for a decade or longer could find that 3D-printing service provider Proto Labs is actually Netflix version 2.0.

The reason Netflix is so successful is that it listened to its customers and fit their demand for streaming content. It didn’t reinvent the wheel. It merely offered a high-margin content service that few competitors have come close to matching. Proto Labs can do the exact same thing for the 3D-printing space.

The secret to Proto Labs’ success is that it’s not involved in the development and manufacture of 3D-printing machines. What we’ve seen from the likes of 3D Systems and Stratasys is that industrial demand for 3D-printers can ebb and flow. Wall Street and investors got their hopes way too high for 3D-printing demand between 2012 and 2014, and when consumer-based sales faltered and industrial demand waned, the industry was slammed.

However, Proto Labs is all about being an on-demand service provider for 3D-printing needs. It provides quick turnaround orders for prototypes or other 3D-printing needs for businesses and clients, making it something of a FedEx office for the 3D-printing space. Not having to spend as much as its peers on research and development, as well as not having to hang onto expensive inventory, is a big reason why Proto Labs’ profits and growth haven’t missed a beat.

Furthermore, Proto Labs isn’t reliant on a single type of technology when receiving orders from customers. This gives the company the flexibility to use whatever production method best fits the bill for a small or large volume order.

Lastly, Proto Labs brings ease of use to the table, just like Netflix does for its members. The CAD/CAM design process can be confusing for businesses. With Proto Labs, there are no concerns about how to work the equipment since the entire process is handed off. 

Looking ahead, Proto Labs is expected to nearly double its sales to an estimated $669 million by 2021, with earnings per share more than doubling to $4.39. This not only suggests rapid and consistent growth, but also margin expansion. Say hello to Netflix 2.0.

Best Heal Care Stocks To Invest In 2019: Netflix, Inc.(NFLX)

Netflix has built itself into a video-streaming powerhouse and now boasts more than 125 million members. The company is experiencing substantial user growth as it expands into international markets. Netflix’s non-U.S. streaming subscribers now account for 54% of the company’s paid subscribers, and in the first quarter of 2018 the company increased paid international subscribers by 42% year over year.

Investors have also been happy to see the company’s sales and earnings continue to spike. Revenue was up more than 40% in the most recent quarter to $3.7 billion, and diluted earnings per share of $0.64 were up 60% from the year-ago quarter, which far outpaced any of the company’s quarterly earnings in 2017. Net income also increased about 63% year over year to $290 million.

Netflix is facing an increase in competition on several fronts, most recently from Disney’s (NYSE:DIS) announcement that it will bring its own content streaming service to market sometime this year. Disney has a war chest of old movies and shows, along with owning massive content franchises like Star Wars and Marvel, which could make Disney’s service a strong contender for people’s money.

But Netflix will likely be able to fend off Disney, and other players including Amazon and Hulu, because of its treasure trove of user data. For years, Netflix has been collecting users’ viewing habits (everything from what we watch and when we watch it) so it can create original content and purchase programming it knows its members will love. Tapping into this data allows Netflix to create a network effect that keeps its users watching more Netflix content, and thus supplying it with more viewing data.

Netflix is spending a lot of money — between $7.5 billion and $8 billion in 2018 — on content, and that’s up from $6 billion last year. Some of this spending comes from Netflix shelling out cash to create shows that will appeal to viewers in local international markets. The company’s subscriber growth shows that spending all of this cash is paying off, but investors should keep an eye on these expenses to see if they continue to climb. At some point, the company should be able to curb spending a bit, or at least let it stabilize, once it’s built up enough original content. But Netflix’s current collection of original content, and its ability to know what its users want to watch, should help it continue dominating the content streaming space for years to come.