Traders and investors focusing on the medical sector are always on the hunt for stocks that outperform the competition. One standout this year is Athira Pharma, Inc. (ATHA), which has drawn attention for its performance within the medical sector. The key question: Does ATHA’s growth suggest it’s a strong buy for investors looking for returns in the healthcare space?
Athira Pharma, Inc. is part of a vast field of 1,017 companies within the medical sector, which holds the #5 spot in the Zacks Sector Rank—a system that evaluates 16 different sectors. Sectors are ranked by the average Zacks Rank of the individual stocks within them, with the top positions signaling stronger overall performance.
The Zacks Rank, a widely recognized system among traders and investors, emphasizes companies with positive earnings estimates and upward revisions. Stocks with higher ranks often have the momentum to beat the market over the next one to three months. Athira Pharma currently holds a Zacks Rank #2 (Buy), indicating a favorable outlook for potential buyers.
One of the primary drivers of this bullish sentiment has been an upward shift in earnings expectations. Over the last quarter, analysts have raised their consensus estimate for Athira’s full-year earnings by 8.2%. This stronger outlook suggests that ATHA could continue to build momentum, offering a promising avenue for investors.
ATHA vs. The Medical Sector: Strong Performance
Year-to-date, Athira Pharma has climbed roughly 28%, significantly outpacing the broader medical sector’s average gain of 11.1%. This performance signals that ATHA is a leader among its peers, as investors are clearly backing the company’s prospects.
However, Athira Pharma isn’t the only medical stock to have outperformed in 2023. HCA Healthcare (HCA), a heavyweight in the Medical – Hospital industry, has surged 41.5% since January. HCA has also benefited from a strong earnings outlook, with a 7.3% boost in its consensus EPS estimate over the last three months. HCA currently boasts a Zacks Rank #1 (Strong Buy), placing it as an attractive option for traders and institutional investors.
Industry Breakdown: Biomedical & Genetics vs. Hospitals
Athira Pharma operates within the Medical – Biomedical and Genetics industry, which includes 497 companies and is currently ranked #84 in the Zacks Industry Rank. While the broader Biomedical and Genetics industry has only advanced by 1.9% year-to-date, Athira’s significant outperformance highlights its strong positioning within this competitive space.
HCA Healthcare, on the other hand, operates in the Medical – Hospital industry, a niche sector with just five major players. This industry currently holds the impressive #2 rank in the Zacks system, benefiting from a sector-wide year-to-date gain of 43%. HCA’s dominance in its space has made it a compelling stock for traders seeking exposure to healthcare services.
What’s Next for Athira Pharma and HCA Healthcare?
As medical stocks continue to attract investor interest, Athira Pharma and HCA Healthcare remain two standout performers to watch. Athira’s earnings momentum and sector outperformance suggest it has the potential to continue delivering solid returns, particularly for those seeking exposure to innovative biotech players. HCA Healthcare, with its dominant position in the hospital industry, offers a different growth narrative—one focused on expanding healthcare services and capturing increased demand.
For investors with a keen interest in the medical sector, tracking the progress of both ATHA and HCA will be crucial as both companies aim to maintain their strong performance.
Key Takeaways for Traders:
- Athira Pharma (ATHA): Up 28% YTD, outperforming its sector peers. Backed by a Zacks Rank #2, with earnings revisions signaling further upside potential. A stock to watch for those interested in high-growth biotech within the medical sector.
- HCA Healthcare (HCA): Up 41.5% YTD, thriving in the Medical – Hospital industry. With a Zacks Rank #1 and strong earnings growth, HCA is a solid bet for investors looking for exposure to healthcare services.
- Sector Comparison: While the Medical – Biomedical and Genetics industry has lagged with a 1.9% YTD gain, ATHA stands out as a leader. Meanwhile, HCA’s industry boasts a strong 43% return YTD, adding more weight to HCA’s growth story.
Investors should stay alert to any shifts in earnings revisions or sector trends, which could either reinforce or disrupt the current momentum in these stocks.
Conclusion:
Athira Pharma and HCA Healthcare present two compelling opportunities for traders looking to capitalize on outperformers in the medical sector. Athira’s strong earnings momentum and biotech focus make it a high-potential option, while HCA’s dominance in the healthcare services space adds stability and growth for those interested in broader exposure to the medical sector. As these companies continue to navigate a volatile healthcare landscape, their performances warrant close attention from traders and investors alike.
