Although the healthcare sector failed to outperform the broader market last year, disappointing some investors, it still offers high-quality choices with long-term holding value. Eli Lilly (LLY), AbbVie (ABBV), and Intuitive Surgical (ISRG) are three leading companies in this field worthy of attention, each demonstrating its unique appeal for investors with a long-term perspective.
As the first healthcare company to surpass a trillion-dollar market capitalization, Eli Lilly’s achievement stems from its leadership in key growth areas. Its core product, tirzepatide, has been approved for weight management, diabetes, and obstructive sleep apnea treatment, and has become the world’s best-selling drug. It is expected to continue driving the company’s revenue growth in the future. Eli Lilly’s innovation strategy does not stop here; its oral drug Orforglipron is expected to gain approval this year, further solidifying its advantage in the diabetes and weight loss markets. At the same time, the company’s expansion in therapeutic areas such as immunology and oncology, along with its investments in artificial intelligence and supercomputing technologies, aims to accelerate drug development, reflecting its deep-rooted culture of innovation. A solid business foundation, outstanding financial performance, and the future prospects built around its weight loss product portfolio collectively justify Eli Lilly as a high-quality asset for long-term holding.
AbbVie has demonstrated strong business resilience with its diversified product portfolio. Its current growth is primarily driven by Skyrizi and Rinvoq in the immunology field, which have been approved for multiple indications. Beyond this, other product lines, including its Botox series, are also robust. The company has successfully navigated the challenges posed by the patent expiration of its blockbuster drug Humira, maintaining stable revenue and profits. Facing future patent expiration cycles, AbbVie has a vast R&D pipeline as a buffer and ample time to develop new blockbuster products. Particularly notable is that AbbVie, as one of the “Dividend Kings,” has increased its dividend payout for at least 50 consecutive years. Its stable finances, strong product pipeline, and outstanding dividend growth record collectively prove its enduring value as a long-term dividend stock.
Intuitive Surgical is a pioneer in the global field of robot-assisted surgery (RAS), and its da Vinci Surgical System is the benchmark product in this field. While continuously expanding its user base, the company has also achieved strong revenue and profit growth. Part of its competitive advantage comes from low switching costs: the da Vinci system is not only widely adopted by hospitals but also deeply integrated into surgeons’ training systems. Once a healthcare institution has invested significantly in purchasing the equipment and completed staff training, the likelihood of switching to a competitor’s system is greatly reduced, forming a solid moat for the company. With the continued global growth in surgical volumes and the expanding range of indications approved for the da Vinci system, the company’s revenue related to consumables and accessories is expected to gain lasting momentum. In the long term, the global trend of population aging will also provide a favorable macro-environment for the company’s development, giving its stock long-term growth potential.
