With the Standard & Poors 500 index and many of its components near all-time highs, it’s difficult to identify stocks with obvious upside in the near-term. However, by considering secular market trends, investors can find particular markets with long-term growth potential. One of these secular trends is the aging of the global consumer base. The median global age today is 29.6, but Bank of America predicts it will be 36.0 by 2050 as Baby Boomers enjoy an extended lifespan. Here are eight stocks that Bank of America says will benefit from the so-called Silver Economy.
UnitedHealth Group, Inc. (UNH) is the largest managed care organization, with major operations in both the U.S. and global markets. In terms of both product lines, geography and customer base, United is the single most diversified MCO on Wall Street. According to Bank of America analyst Kevin Fischbeck[WD], United has some positive momentum headed into 2019, including expansions and new client wins. United has also has tremendous success converting retirees to Medicare Advantage, where United has a leading 31.5 percent market share. Bank of America has a “buy” rating and $290 price target for UNH stock.
2. Capital Senior Living
Capital Senior Living Corporation (CSU) operates more than 125 senior adult residential communities throughout the U.S. which house more than 16,500 residents. In addition to independent residency, Capital Senior Living provides home care and assisted living services. Analyst Joanna Gajuk[WD] says the fact that nearly 100 percent of Capital Senior Living’s revenue comes from private payments insulates the company from potential government policy risk. In addition, Capital Senior Living owns roughy 64 percent of its property assets, which provides downside protection for the stock. Bank of America has a “neutral” rating and $10 price target for CSU stock.
3. Boyd Gaming
The casinos operated by Boyd Gaming Corporation (BYD) are popular destinations for retirees. While gambling hubs like Macau, China and the Las Vegas Strip are attracting plenty of younger gamblers, older gamblers tend to gravitate more to downtown Las Vegas and regional casinos throughout the U.S. Boyd operates three casinos in downtown Vegas and 21 other casinos in states such as Illinois, Indiana, and Mississippi. Analyst Shaun Kelley[WD] says Boyd is growing revenue, boosting margins and keeping an eye out for merger opportunities. Bank of America has a “buy” rating and $45 price target for BYD stock.
4. Lincoln National
As Americans age, making sure their family is provided for once they are gone becomes an important consideration. In addition to being a diversified life insurance provider, Lincoln National Corporation (LNC) has a range of offerings that appeal to older customers, including annuities, retirement products, and financial services. Analyst Jay Cohen[WD] says the company has demonstrated strong earnings growth and exceptional capital management. In the most recent quarter, Lincoln National reported its highest annuity sales in three years. Bank of America has a “buy” rating and $79 price target for LNC stock.
While a technology company like Apple, Inc (AAPL) may not seem like an obvious beneficiary of an aging population, the inevitable integration of technology into the healthcare field puts…
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