In this article, we will be taking a look at the 12 Best Healthcare stocks to Buy and Hold for 5 Years.
The CEO and co-founder of Claimable, Dr. Warris Bokhari, spoke on CNBC’s “Squawk Box” on July 21 about using AI to challenge health insurance denials and other topics.
Most Americans have endured the annoyance of having their health insurance denied, frequently with no resolution even after contacting carriers via phone and email. This can be changed by Dr. Bokhari’s platform, which employs artificial intelligence (AI) to appeal care denials for about 70 autoimmune illnesses, including Crohn’s disease.
Following patient completion of a form, AI manages the following steps, looking up pertinent state and federal regulations as well as healthcare plans.
According to Dr. Bokhari, the platform was created after ten years of observing one of America’s particular issues: 850 million denials occur annually, and only around 1% of them are ever appealed. According to these figures, between 70 and 90 million Americans face insurance-related problems each year, including denials.
The program, which was only launched in the United States on October 2, 2024, assists patients in appealing care denials for 70 autoimmune disorders. AI is used to create appeal letters according to healthcare plans.
With this in mind, let’s dive in and take a look at the best healthcare stocks to buy and hold for 5 years.
Our Methodology
For our methodology, using stock analysis’s stock screener we began by filtering healthcare stocks stocks with EPS growth of more than 10% over the past five years and an expected EPS growth rate of at least 20% over the next five years, forward PE more than 20 and then based on the redults we picked the top 12 stocks and the final ranking was based on total number of hedge fund holders as of Q2 2025 as tracked by the Insider Monkey databse.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Here is our list of the 12 best healthcare stocks to buy and hold for 5 years.
12. Intuitive Surgical, Inc. (NASDAQ:ISRG)
Number of Hedge Fund Holders: 27
Intuitive Surgical, Inc. (NASDAQ:ISRG) has pioneered robotic-assisted minimally invasive surgery (MIS), with its da Vinci systems now used in millions of procedures and training tens of thousands of surgeons globally. ISRG is among the best healthcare stocks.
In September 2025, ISRG introduced advanced software features for its da Vinci 5 system, the most powerful in its portfolio. Key updates include Force Gauge for real-time instrument pressure monitoring, In-Console Video Replay for instant procedural review, and Network CCM for remote software updates. These enhancements leverage the platform’s computational power, 10,000 times greater than the prior Xi system, enabling real-time surgical insights and advanced safety capabilities.
A major highlight is the successful demonstration of telesurgery, where surgeons collaborated across 4,000 miles from Georgia to France using dual da Vinci 5 consoles. While still in development and awaiting FDA clearance, this breakthrough points to a future where advanced surgeries can reach patients globally. Additionally, new regulatory approvals in Europe, Japan, and Korea expand the business’s international footprint.
Looking ahead, Intuitive Surgical, Inc. (NASDAQ:ISRG) is focusing on AI and data-driven surgery. The da Vinci 5’s computing power supports predictive analytics, personalized training, and real-time guidance, paving the way for smarter, more precise, and safer procedures over the next five years. With these innovations, the firm reinforces its commitment to advancing minimally invasive care while expanding global access to cutting-edge surgical technology.
11. Doximity, Inc. (NYSE:DOCS)
Number of Hedge Fund Holders: 41
Doximity, Inc. (NYSE:DOCS) remains a leading healthcare technology stock, leveraging AI-driven tools and strategic acquisitions to strengthen its position in the medical sector. The company operates a cloud-based professional network for U.S. clinicians, offering secure telemedicine, collaboration, and workflow solutions.
Recently, DOCS completed the acquisition of Pathway Medical, an AI-powered clinical reference platform. The integration enhances Doximity’s flagship DoxGPT tool, providing instant, verified access to medical data, peer-reviewed research, and context-aware AI responses within daily clinical workflows. Pathway’s AI model scored 96% on the U.S. Medical Licensing Exam benchmark, underscoring the corporation’s commitment to clinical quality and innovation.
DOCS also expanded its offerings with Doximity Scribe, a free ambient AI scribe that automates clinical documentation and reduces after-hours administrative work.
Doximity, Inc. (NYSE:DOCS)’s last quarter, ending June 30, 2025, saw revenue climb 15% year-over-year, reaching $145.9 million, which exceeded analyst forecasts. The company delivered non-GAAP earnings per share (EPS) of $0.36. User engagement and product adoption surged, especially in new AI scribe and workflow tools.
10. Penumbra, Inc. (NYSE:PEN)
Number of Hedge Fund Holders: 47
Penumbra, Inc. (NYSE:PEN) based in California, is a global leader in thrombectomy and vascular intervention technologies, offering products such as the Indigo and Lightning series, as well as neuro and vascular embolization solutions. Operating in over 100 countries, the company serves acute stroke and broader vascular markets through both direct and distributor-driven channels.
In September 2025, Shruthi Narayan was promoted to President, bringing engineering and commercialization expertise to strengthen PEN’s focus on global innovation and market growth. The business also introduced the Ruby XL System, the largest and longest detachable embolization coil, demonstrating versatility in complex vascular procedures and supporting wider clinical adoption. These advances contribute to PEN’s reputation among the best healthcare stocks.
Expanding its thrombectomy capabilities, Penumbra, Inc. (NYSE:PEN) released the Lightning Bolt 6X device in a 150 cm length, enabling Computer Assisted Vacuum Thrombectomy (CAVT) in smaller, distal vessels, a critical advance for peripheral arterial disease interventions. Additionally, the firm completed enrollment for the STORM-PE Randomized Controlled Trial, evaluating CAVT’s effectiveness in pulmonary embolism, with results poised to influence future treatment guidelines and expand market penetration.
Looking ahead, Penumbra, Inc. (NYSE:PEN) remains committed to advancing minimally invasive clot removal technologies that improve patient outcomes while enhancing healthcare efficiency. The firm’s recent clinical data highlights the speed, safety, and efficacy of its CAVT devices, reinforcing growth potential in both U.S. and international markets.
9. IDEXX Laboratories, Inc. (NASDAQ:IDXX)
Number of Hedge Fund Holders: 48
IDEXX Laboratories, Inc. (NASDAQ:IDXX) specializes in animal health diagnostics, veterinary software, and laboratory services, supporting companion animals, livestock, water testing, and food safety worldwide. Its platforms, including imaging systems, in-clinic analyzers, and point-of-care tools, enable veterinarians to quickly diagnose and treat a wide range of conditions.
In August 2025, IDXX reported impressive Q2 earnings, with revenue of $1.11 billion, a 10.6% year-over-year increase, and earnings per share rising to $3.63, far exceeding market expectations. These results prompted the business to raise its full-year revenue and profit forecasts, reflecting continued momentum in diagnostics and laboratory services.
A key growth driver has been the rollout of the inVue Dx analyzer, a rapid blood and ear canal diagnostic device. Roughly 2,400 units were installed in Q2, prompting an upward revision of the full-year installation target to 5,500 units. This launch strengthens IDXX’s leadership in point-of-care veterinary testing and supports accelerating organic growth.
Analysts now project 2025 earnings per share between $12.40 and $12.76, reflecting expanding margins and strong operational performance. Over the past three years, IDEXX Laboratories, Inc. (NASDAQ:IDXX) shares have returned 97%, significantly outperforming competitors such as Zoetis and the broader market, highlighting its position as a top-performing stock in the animal health sector.
8. Encompass Health Corporation (NYSE:EHC)
Number of Hedge Fund Holders: 49
Encompass Health Corporation (NYSE:EHC) is the largest owner and operator of inpatient rehabilitation hospitals in the U.S., with over 160 facilities across 38 states and Puerto Rico. The company provides intensive rehabilitation for patients recovering from strokes, brain injuries, spinal cord injuries, amputations, and complex orthopedic conditions, offering personalized care plans that combine physical, occupational, and speech therapies with 24-hour nursing and physician oversight.
In September 2025, EHC expanded its footprint with two new hospitals. On September 25, the company opened its first facility in Connecticut, Encompass Health Rehabilitation Hospital of Danbury. The 40-bed, 50,500-square-foot hospital features advanced rehabilitation technologies, private patient rooms, therapy gyms, and in-house dialysis and pharmacy services. Earlier, Encompass Health Corporation (NYSE:EHC) launched a 50-bed satellite hospital in Sumter County, Florida, providing intensive therapy and physician-led care for patients recovering from major injuries and illnesses. These expansions further solidify EHC’s standing among the best healthcare stocks.
These openings align with EHC’s growth strategy, which includes developing de novo hospitals and satellite locations. The business plans to open seven new hospitals and add around 100 beds to existing facilities in 2025, addressing rising demand driven by an aging population and increasing chronic conditions.
Financially, Encompass Health Corporation (NYSE:EHC) reported first-half 2025 net operating revenue of $2.91 billion, up 11.3% year-over-year, with full-year revenue guidance of $5.88–$5.98 billion. Occupancy rates improved from 72.1% in 2023 to 77.7% in the first half of 2025, reflecting stronger utilization and operational momentum across its network.
7. Agilent Technologies, Inc. (NYSE:A)
Number of Hedge Fund Holders: 50
Agilent Technologies, Inc. (NYSE:A) is a global leader in life sciences, diagnostics, and applied chemical solutions, providing instruments, software, and services for pharmaceutical, biotech, clinical, and environmental applications.
In Q3 fiscal 2025, the corporation reported non-GAAP earnings per share (EPS) of $1.37, surpassing analyst expectations, with revenue growing 10.1% year-over-year to $1.74 billion across its Life Sciences and Diagnostics, CrossLab, and Applied Markets segments. The company issued strong guidance for Q4 and fiscal year 2025, signaling continued revenue and earnings growth.
Highlighting its innovation strategy, Agilent Technologies, Inc. (NYSE:A) announced a strategic partnership with Lunit, an AI diagnostics firm specializing in cancer detection. The collaboration will integrate the firm’s tissue diagnostic expertise with Lunit’s AI algorithms to co-develop next-generation companion diagnostics, aiming to enhance biomarker testing precision and patient treatment options. This initiative underscores business’ focus on AI-driven precision medicine, a rapidly growing area in healthcare.
Agilent Technologies, Inc. (NYSE:A) also demonstrated commitment to shareholder returns by declaring a quarterly cash dividend of $0.2480 per share, above its 10-year average, with an ex-dividend date of September 30, 2025. The company participated in the 2025 Bank of America Global Healthcare Conference and has established an Open Biopharma Research Hub with Chungnam National University to accelerate innovation in biopharmaceutical development.
6. Insulet Corporation (NASDAQ:PODD)
Number of Hedge Fund Holders: 53
Insulet Corporation (NASDAQ:PODD) is a global leader in tubeless insulin pump technology, offering innovative diabetes management solutions through its Omnipod Insulin Management System. The flagship Omnipod 5 Automated Insulin Delivery System integrates with continuous glucose monitors to deliver automated, needle-free insulin dosing for type 1 and type 2 diabetes patients, controlled via smartphone or Omnipod controller.
In Q2 2025, Insulet Corporation (NASDAQ:PODD) reported $649.1 million in revenue, up 32.9% year-over-year, driven by strong customer adoption in the U.S. and international markets. The Omnipod product line generated $639 million, with gross margins of 69.7% and operating income of $121.1 million. Net income reached $22.5 million, or $0.32 per share, further cementing PODD’s reputation among the best healthcare stocks. Following this performance, the corporation raised its full-year revenue growth guidance to 24–27% and adjusted operating margin guidance to 17–17.5%.
PODD also strengthened its brand identity through a partnership with Pantone®, launching Omnipod Mango, a vibrant new color celebrating the diabetes community. Insulet Corporation (NASDAQ:PODD) continues expanding Omnipod 5 compatibility with multiple continuous glucose monitors and advancing international adoption, including in Europe, where Omnipod 5 is now the first automated insulin delivery system prescribed for new users.
5. Stryker Corporation (NYSE:SYK)
Number of Hedge Fund Holders: 59
Stryker Corporation (NYSE:SYK), a global leader in medical technology, has strengthened its innovation footprint with the opening of a 140,000-square-foot research and development center in Bangalore, India. The facility will focus on robotics, artificial intelligence (AI), digital health, and product security, aiming to accelerate product development and strengthen collaboration with healthcare providers, particularly in emerging markets. By leveraging India’s talent pool and cost efficiencies, SYK is positioning itself for sustainable growth and stronger global margins.
Further advancing its technology-driven strategy, Stryker Corporation (NYSE:SYK) announced a partnership with Siemens Healthineers to co-develop a robotic system for neurovascular procedures. The initiative targets greater precision and efficiency in treating strokes and aneurysms, underscoring the firm’s expansion into robotics and integrated digital platforms within the neurotechnology sector.
The business also broadened its orthopaedics portfolio with the launch of the Incompass Total Ankle System at the 2025 American Orthopaedic Foot & Ankle Society (AOFAS) meeting in September. This rollout reflects ongoing investment in specialized medical solutions to address diverse patient needs.
Financially, Stryker Corporation (NYSE:SYK) continues to deliver strong results, with recent quarterly earnings surpassing analyst estimates. The company reaffirmed its optimistic full-year 2025 earnings guidance of $13.40 to $13.60 per share, supported by innovation, global expansion, and a robust product pipeline.
4. DexCom, Inc. (NASDAQ:DXCM)
Number of Hedge Fund Holders: 60
DexCom, Inc. (NASDAQ:DXCM), a leader in continuous glucose monitoring (CGM) systems, continues to advance diabetes care with its flagship G6 and G7 devices, which provide real-time glucose tracking and data sharing. At EASD 2025, the company highlighted upcoming features aimed at improving health outcomes and cost-effectiveness, reinforcing its innovation strategy in biosensing technology. These developments have kept DXCM among the best healthcare stocks, despite recent challenges.
Financial performance remains strong, with second-quarter 2025 revenue rising 15.2% year-over-year and earnings per share beating analyst estimates. Analysts maintain a moderate to strong buy consensus on DXCM, with price targets nearing $100, citing robust demand for its CGM systems.
However, September brought challenges after a report alleged unauthorized design changes in the G7 system, linking the issue to severe safety risks, including hospitalizations and deaths. The controversy sparked an 11.76% stock drop and prompted a class action investigation by Pomerantz LLP into potential securities fraud claims.
3. Veeva Systems Inc. (NYSE:VEEV)
Number of Hedge Fund Holders: 61
Veeva Systems Inc. (NYSE:VEEV), a leading provider of cloud-based software for the life sciences industry, continues to expand its influence through platforms such as Veeva Commercial Cloud, Data Cloud, and Development Cloud. Serving more than 1,500 global customers, the company operates as a Public Benefit Corporation, reflecting its commitment to balancing stakeholder interests.
A major endorsement came recently from Bristol Myers Squibb, which adopted Veeva Vault CRM, reinforcing VEEV’s strong position in the sector. Looking ahead, the company will host a Virtual Investor Day on October 16, 2025, expected to outline future strategies and product innovations.
Financially, Veeva Systems Inc. (NYSE:VEEV) remains on solid ground with revenue up 16.7% year-over-year and free cash flow of about $1.18 billion, which it reinvests into growth rather than paying dividends. Analysts remain optimistic, with an average price target suggesting nearly 14% upside. The company’s forward P/E ratio also signals market confidence in continued double-digit revenue expansion.
Strategically, the corporation is capitalizing on the growing demand for digital transformation in healthcare. By integrating AI capabilities into its platforms, the company is positioning itself at the forefront of cloud-based, generative AI-enabled solutions for pharmaceutical and biotechnology clients.
2. Zoetis Inc. (NYSE:ZTS)
Number of Hedge Fund Holders: 75
Zoetis Inc. (NYSE:ZTS), a global leader in animal health, reported solid second-quarter 2025 results with revenue rising 4% year-over-year to $2.5 billion and net income up 15% to $718 million. Growth was driven by an 8% increase in companion animal product sales, led by flagship products such as Simparica Trio for parasite prevention and pain and dermatology treatments, including Rela Solens, Apoquel, and Cytopoint. On the back of these results, ZTS raised its full-year revenue forecast to $9.45–$9.6 billion and guided adjusted earnings per share to between $6.30 and $6.40.
In September, the company announced a major pipeline milestone with a positive opinion from the European Medicines Agency’s Committee for Medicinal Products for Veterinary Use (CVMP) for Portela® (relfovetmab). This monoclonal antibody is designed to treat osteoarthritis pain in cats, potentially offering up to three months of relief from a single injection. If approved by the European Commission in Q4 2025, it would become the first long-acting anti-NGF therapy for cats, addressing a widespread but underdiagnosed condition affecting an estimated 40% of the feline population.
Zoetis Inc. (NYSE:ZTS) will provide further updates on its financial and strategic outlook during its third-quarter earnings webcast and conference call scheduled for November 4, 2025, with CEO Kristin Peck and CFO Wetteny Joseph.
1. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 119
Eli Lilly and Company (NYSE:LLY) tops our list for being one of the best healthcare stocks. It is a global biopharmaceutical leader and continues to expand its presence across diabetes, obesity, oncology, immunology, and neurology. The company’s portfolio includes blockbuster drugs such as Mounjaro and Zepbound for diabetes and obesity, as well as donanemab for Alzheimer’s disease, supported by strong R&D capabilities and consistent commercial execution.
In September 2025, LLY announced plans for a $6.5 billion manufacturing facility in Houston, Texas, one of the city’s largest private investments in recent years. The site will expand production for small-molecule medicines, including orforglipron, its experimental oral GLP-1 receptor agonist for obesity. Expected to be operational within five years, the facility will create several hundred jobs while reinforcing LLY’s commitment to next-generation obesity treatments.
Eli Lilly and Company (NYSE:LLY) is also pursuing international growth, with plans to launch orforglipron in India pending regulatory approval. This move highlights the firm’s strategy to capture demand for oral weight-loss drugs in emerging markets. At the same time, the corporation streamlined its pipeline by halting development of a muscle-preserving drug paired with Zepbound, choosing to focus resources on its most promising obesity assets.
Meanwhile, LLY strengthened its neurology portfolio as European regulators granted marketing authorization for donanemab, advancing the business’s position in Alzheimer’s disease therapies. Financially, the firm reported strong international growth for Mounjaro, though U.S. sales were slightly impacted by isolated formulary challenges. Nevertheless, global demand for tirzepatide-based treatments remains robust, supporting an optimistic outlook for continued expansion.
While we acknowledge the potential of LLY to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than LLY and that has 100x upside potential, check out our report about this cheapest AI stock.
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