15 Best Healthcare Stocks In Canada (Sep 2022)

A decent number of sources place Canada’s healthcare system among the top ten. Most of the 1,200 hospitals in Canada are publicly funded, and only a tiny number are purely for-profit.

With this level of public funding and ownership, the healthcare industry landscape (from an investment perspective) is quite different from other countries such as the U.S.

Canada has a decent number of publicly listed healthcare companies. Some of the best healthcare stocks in Canada are potentially excellent investment assets that investors should look into.

Healthcare Industry In Canada

Healthcare stocks in Canada are pretty diverse. Healthcare facilities and pharmacies are evergreen businesses, but there are almost no general healthcare facilities under publicly listed companies in Canada.

Additionally, most of the private pharmacy chains are consolidated under names like Metro.

Pharmaceutical companies are also neither as large nor as well known as their US counterparts.

Best Healthcare Stocks In Canada

There are plenty of fantastic healthcare stocks in Canada and a lot of variety to choose from.

I’ve excluded marijuana companies here, even though some can argue they are healthcare companies for the medicinal uses of the product.

1. Bausch Health Companies Stock (TSX)

Bausch Health Companies Stock (TSX)
  • Ticker: BHC.TO
  • Niche: Pharmaceutical
  • Forward Dividend Yield: N/A
  • Market Cap: $3.48 Billion
  • Forward P/E Ratio: 1.56

Bausch Health Companies is the largest healthcare stock (by market cap) in Canada and the second-largest pharmaceutical company (Canadian-based) after Apotex, the largest generic drug producer in Canada.

However, it didn’t start as Bausch and had a different name till 2018 – Valeant. Valeant became the most valuable Canadian company in 2015.

Still, after some legal troubles with the US SEC, the company lost most of its valuation and is currently a fraction of its former glory.

The Bosch + Lomb (after the merger) generates most of its revenue from eye-care products (Drugs and other solutions) and a relatively small portion from surgical products.

The company has an impressive international presence, and only about 20% of its revenue comes from within the country.

2. Dentalcorp Holdings Stock

Dentalcorp Holdings Stock
  • Ticker: DNTL.TO
  • Niche: Dental Practice Network  
  • Forward Dividend Yield: N/A
  • Market Cap: $1.59 Billion
  • Forward P/E Ratio: 95.56
  • Average Analyst Rating: 1.7 - Buy

It’s a relatively new company and even newer stock. The company was founded in 2011, and the stock joined the TSX in May 2021 and has mostly fluctuated since inception.

It’s already the largest network of dental practices in the country, with over 445 locations and over 7,100 team members (early 2022). The network as a whole caters to about four million patients a year.

The company offers a unique advantage. By consolidating so many dental practices and professionals under one banner, it could establish itself as the market leader.

3. Sienna Senior Living Stock

Sienna Senior Living Stock
  • Ticker: SIA.TO
  • Niche: Senior Housing
  • Forward Dividend Yield: 6.89%
  • Dividend Payout Ratio: 170.18%
  • Dividend Yield (12-Month Trailing): 7.19%
  • Upcoming Dividend Date: Sep 15, 2022
  • Market Cap: $919.99 Million
  • Forward P/E Ratio: 27.43
  • Average Analyst Rating: 2.2 - Buy

The senior population is a substantial part of the total Canadian population and is expected to increase steadily with advances in healthcare and medicine.

Sienna is one of the largest companies (by market cap) in this space and has a portfolio of about 43 long-term care, 27 retirement, and 13 managed residences that collectively have over 11,600 beds (the number of seniors it can cater to).

All of its properties are in Ontario and BC.

Thanks to the nature of its business, the company has significant expenses, and the largest of them is likely the staffing.

However, the company still manages to pay healthy dividends, and the yield is usually relatively high. Its long-term growth prospects are quite minimal.

4. Neighborly Pharmacy Stock

Neighborly Pharmacy Stock
  • Ticker: NBLY.TO
  • Niche: Pharmacy Chain  
  • Forward Dividend Yield: 0.93%
  • Dividend Payout Ratio: 3.02%
  • Dividend Yield (12-Month Trailing): 0.92%
  • Upcoming Dividend Date: Sep 27, 2022
  • Market Cap: $872.35 Million
  • Forward P/E Ratio: 23.45
  • Average Analyst Rating: 2.2 - Buy

As the name suggests, neighbourly pharmacy is all about community pharmacies.

It has a decent pace when it comes to acquiring community pharmacies, and between 2018 and 2022 (partial), the company acquired about 168 pharmacies, and the pace of acquisitions is steadily increasing over the years.

If the company can keep up that pace, it may offer serious competition to Metro and its network of 650 pharmacies.

5. WELL Health Technologies Stock

WELL Health Technologies Stock
  • Ticker: WELL.TO
  • Niche: Digital Healthcare    
  • Forward Dividend Yield: N/A
  • Market Cap: $711.95 Million
  • Forward P/E Ratio: 104.67
  • Average Analyst Rating: 1.8 - Buy

Telehealth/digital health got a lot of limelight during the pandemic, but it was not an isolated incident.

As technologies improve and become more accessible, the merger of health and digital technologies will evolve further, and companies like Well Health will thrive.

Its primary focus is providing healthcare practitioners a platform, and by the end of 2021, the platform supported over 15,000 practitioners and had 36 different health applications under its banner.

The stock saw phenomenal growth of about 1,600% between its inception (April 2016) and pre-pandemic peak (Feb 2020).

And even though it’s hard to replicate that kind of growth, the stock is still a powerful capital appreciation asset.

6. Andlauer Healthcare Group Stock

Andlauer Healthcare Group Stock
  • Ticker: AND.TO
  • Niche: Healthcare Logistics/Delivery     
  • Forward Dividend Yield: 0.49%
  • Dividend Payout Ratio: 8.97%
  • Dividend Yield (12-Month Trailing): 0.46%
  • Upcoming Dividend Date: Jul 15, 2022
  • Market Cap: $1.94 Billion
  • Forward P/E Ratio: 25.34
  • Average Analyst Rating: 2.8 - Hold

Andlauer Healthcare is primarily a logistics and transportation business, but it caters specifically to the healthcare industry.

It prides itself on its end-to-end delivery solutions and has a decent network of operating centers, distribution centers, and cross docks.

It’s connected to pharmaceutical manufacturers like Pfizer and Bayer, wholesalers/distributors like Shoppers Drug Mart and Jean Coutu, and third-party logistics companies like UPS.

It also operates in the US via its subsidiaries and a fleet of 150 trucks and 200 trailers.

7. BELLUS Health Stock

BELLUS Health Stock
  • Ticker: BLU.TO
  • Niche: Biotech     
  • Forward Dividend Yield: N/A
  • Market Cap: $1.77 Billion
  • Forward P/E Ratio: -14.71
  • Average Analyst Rating: 2.0 - Buy 

Bellus is another company that is currently a fraction of its glory days. In the pre-recession times (between 2002 and 2007), the company used to trade over $3,000 per share.

That said, the company is certainly capable of decent cyclical growth, and in the last five years, it has offered two distinct growth phases: About 1,500% growth between March 2017 and July 2020, and the second one was post-pandemic, which pushed the stock up almost 250% at its best.

It’s basically a clinical-stage pharmaceutical company and is focused on a specific antagonist, primarily against chronic cough.

If the treatment its development gets approved by the FDA, the stock could be poised for growth.

8. Extendicare Stock

Extendicare Stock
  • Ticker: EXE.TO
  • Niche: Senior Care   
  • Forward Dividend Yield: 6.40%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $615.96 Million
  • Forward P/E Ratio: 21.03
  • Average Analyst Rating: 3.0 - Hold    

Extendicare owns and operates a network of about 120 senior care and retirement facilities. It has five different brands under the Extendicare banner, three of which cater directly to the customers.

That includes long-term care, retirement living, and home healthcare. The other two are B2B brands. The bulk of the company’s net operating income is generated by the long-term care segment of the business.

However, the company’s generous dividend yield is one of the main reasons people consider investing in this stock.

9. HLS Therapeutics Stock

HLS Therapeutics Stock
  • Ticker: HLS.TO
  • Niche: Pharmaceutical
  • Forward Dividend Yield: 1.57%
  • Dividend Yield (12-Month Trailing): 1.63%
  • Upcoming Dividend Date: Dec 15, 2022
  • Market Cap: $307.94 Million
  • Forward P/E Ratio: 35.19
  • Average Analyst Rating: 1.7 - Buy

HLS therapeutics, while not a drug manufacturer by default, basically acquires and commercializes late-stage drugs/pharmaceutical products, which essentially means that these drugs are quite close to entering the mainstream market.

The company focuses on two areas in particular: The cardiovascular and central nervous systems.

One major product associated with HLS Therapeutics is Vascepa, a drug that reduces the risk of a heart attack.

10. Dialogue Health Technologies Stock

Dialogue Health Technologies Stock
  • Ticker: CARE.TO
  • Niche: Healthcare Platform
  • Forward Dividend Yield: N/A
  • Market Cap: $163.05 Million
  • Forward P/E Ratio: -16.47
  • Average Analyst Rating: 2.2 - Buy

Dialogue Health Technologies offers an integrated healthcare platform that focuses on health benefits.

It’s primarily a B2B company that offers its platforms to businesses to offer it to their employees, so they can navigate their health benefits more efficiently and the most out of them.

It also facilitates virtual healthcare, which may play a critical role in this platform’s growth going forward.

The platform is already used by about 25,000 organizations and, through them, serves millions of Canadians.

11. Zentek Stock (TSXV)

Zentek Stock (TSXV)
  • Ticker: ZEN.V
  • Niche: Amalgamation Of Healthcare And Nano-Tech
  • Forward Dividend Yield: N/A
  • Market Cap: $247.41 Million
  • Forward P/E Ratio: -24.9

Zentek is quite a forward-looking company. Its primary focus is nano-technology, and the company is currently exploring its uses in three healthcare dimensions: prevention, detection, and treatment.

Its prevention segment focused on masks during COVID, while the detection segment created a rapid testing technology.

The treatment segment of the company’s business focuses on developing antimicrobial therapies.

12. Hamilton Thorne Stock (TSXV)

Hamilton Thorne Stock (TSXV)
  • Ticker: HTL.V
  • Niche: Proprietary Laser Technology (and solutions) For Healthcare   
  • Forward Dividend Yield: N/A
  • Market Cap: $233.95 Million
  • Forward P/E Ratio: 32.4
  • Average Analyst Rating: 1.9 - Buy

Hamilton Thorne is a US-based company and a Canadian stock, and it’s one of the most consistent growth stocks (at least since 2016) in the healthcare sector.

The company has a proprietary laser technology that it uses in a variety of image analysis and microsurgery solutions, especially in the field of IVF.

This micro-cap company operates via six different brands and has a healthy and geographically diverse clientele. It also caters to about two-fifths of the total market (clinics around the globe).

Thanks to its competitive advantage in a niche and stable market segment of healthcare and its powerful capital appreciation potential, it has risen as one of the best healthcare stocks in Canada.

13. Profound Medical Stock

Profound Medical Stock
  • Ticker: PRN.TO
  • Niche: Incision-free Therapies
  • Forward Dividend Yield: N/A
  • Market Cap: $118.54 Million
  • Forward P/E Ratio: -4.09
  • Average Analyst Rating: 1.8 - Buy     

Profound Medical has partnered with globally well-known names (Siemens, Phillips, and GE) and is currently in the process of commercializing two technologies.

One is TULSA-PRO® which offers incision-free Inside-Out Prostate Disease Ablation. The other is Sonalleve, which offers the opposite of TUSLA, i.e., Outside-In Disease Ablation, using Ultra-High-Frequency Sounds.

14. Kneat.com Stock

Kneat.com Stock
  • Ticker: KSI.TO
  • Niche: Paperless Validation
  • Forward Dividend Yield: N/A
  • Market Cap: $185.81 Million
  • Forward P/E Ratio: -20
  • Average Analyst Rating: 1.8 - Buy   

Kneat is more of a tech platform than a healthcare stock, but since it caters primarily to life science companies, it’s part of the healthcare sector in Canada.

The company is based in Ireland and has one of the most widely used e-validation software in the pharma industry, and seven out of the top ten pharmaceutical companies in the world already use Kneat for their E-validation needs.

15.  Viemed Healthcare Stock

Viemed Healthcare Stock
  • Ticker: VMD.TO
  • Niche: Home Healthcare     
  • Forward Dividend Yield: N/A
  • Market Cap: $291.63 Million
  • Forward P/E Ratio: 15.26
  • Average Analyst Rating: 2.0 - Buy 

Another US-based company that you might consider investing in is Viemed. It provides a very specific home care service, i.e., Home Respiratory Care.

According to the company’s estimate, about 25 million people in the US suffer from Chronic Obstructive Pulmonary Disease, and many of them (based on the severity of the disease) need the services that Viemed provides.

The company was the third-largest provider in that sphere in 2022. It doesn’t just offer services but also provides a decent selection of products specific to the care of such patients.

The stock’s performance has been quite decent so far, and in a healthy market, it may offer powerful growth.

How To Buy Healthcare Stocks In Canada

The cheapest way to buy stocks is from discount brokers. My top choices in Canada are:

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To learn more, check out my full breakdown of the best trading platforms in Canada here.

Conclusion

Most healthcare stocks in Canada offer cyclical growth. Some offer linear growth always, and a few under the right circumstances.

The percentage of dividend stocks is low, but the few that offer dividends are worth considering, thanks to their yield.

The best healthcare stocks in Canada are a powerful asset pool that you should look into and pick the companies that match your investment goals and risk tolerance.

And if you want relatively more diversified exposure to healthcare, these Biotech ETFs may be worth looking into.

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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