Boris Schlossberg, a strategist with BK Asset Management, also argued that the healthcare sector is exhibiting positive momentum and will keep pace after the Supreme Court’s ruling.
“The technicals and the fundamentals really line up, because we clearly have a secular change towards health care, particularly with today’s ruling helping the sector,” Schlossberg said on CNBC.
However, investors will have to watch for meaningful earnings growth ahead as valuations are beginning to look pricey. For instance, XLV shows a price-to-earnings ratio of 22.7 and a price-to-book of 4.0.
“If you have some type of a scare, some type of a retrenchment of stocks, this seems to be an area that could take a pretty good wallop, just because valuations have run so much compared to other areas of the market,” Curtis Holden, senior investment officer at Tanglewood Wealth Management, warned.
For more information on the healthcare sector, visit our healthcare category.
Max Chen contributed to this article.