The Best Kind of Healthcare Reform You Can Get
by Marc Lichtenfeld, Healthcare Expert
Wednesday, March 3, 2010: Issue #1208
Last weekend, I was in Costco when I noticed what represented two Americas:
- America #1: As I was in line at the checkout, I thought I recognized someone from a television commercial. One of those health ads where they show 70-year-old men with the physiques of 30-year-olds. The man, clearly in his 70s, was in great shape. I looked in his shopping cart. It was filled with fruits, vegetables and some salmon. There was clearly a reason this gentleman looked the way he did.
- America #2: On the way out of the store, I was behind an overweight couple – probably in their 40s. The minute they got outside, they lit up cigarettes. They heaved their cart over to their SUV, where they unloaded cases of Dr. Pepper, Red Bull, Winston cigarettes and pre-packaged snack foods.
Such a stark contrast made me think about the “Health of the Nation” and the seemingly eternal effort to come up with a healthcare reform bill.
In the end, Republicans and Democrats can squabble all they want, but here’s the deal…
Hit the Gym, America!
You won’t find many politicians brave enough to say this (they’re too busy bickering and playing politics), so I will…
If we’re talking about a health insurance and healthcare overhaul, what really needs to be overhauled is some Americans’ lifestyles. Not much is going to change for America’s healthcare system if some folks don’t change their habits and make better choices.
I’m not taking an unnecessary shot at overweight people here – the latest data from the Centers for Disease Control and Prevention tell the tale…
- In 2008, 34% of American adults were classified as “obese.” (That’s about 30 pounds or more over their healthy weight.)
- By gender, 32.2% of men are obese, while 35.5% of women hold that unwanted tag.
- In children, the obesity rate is 31.7%.
And the bottom line is that it’s an extreme burden on the economy. Because of the additional risk of associated illnesses like heart disease, diabetes and other problems, obese Americans cost the country $147 billion in 2008.
And we’ll continue to pay those healthcare costs in future – either through higher taxes, higher insurance rates, or both.
A More Personal Kind of “Healthcare Reform”
If some brave politicians truly want to help Americans live better lives, some kind of incentive or discount for leading a healthy lifestyle will be included in a healthcare reform package.
But a practical solution like that is clearly too much to ask for from our elected officials, who would never dare tell the people who elected them that they have to do anything unpleasant.
Regardless of Washington’s ineptness, though, Americans are likely to start adopting healthier practices as they age. All it takes is a cholesterol reading over 200 for the first time to scare some people straight.
Up until now, however, you’d be committing financial suicide to bet against firms like tobacco maker Altria Group (NYSE: MO), or fast food companies like McDonald’s (NYSE: MCD).
But going forward, as an aging population starts to worry about their health, some stocks are poised to benefit…
Four Stocks to Profit As America Fights the Fat
When people think about healthy eating, one area that springs to mind is organic foods. And there are four firms that offer investors as much choice as they offer health-conscious Americans…
- Safeway (NYSE: SWY)
While Whole Foods (Nasdaq: WFMI) is the leader in the organic foods field and has vaulted in popularity, the company’s valuation has soared, too. Shares are expensive, trading at 37 times earnings.
Safeway is a cheaper alternative and has been building up its organic offerings for a while. The stock trades at just 12 times earnings, below the grocery stores industry average of 15. And it pays a 1.6% dividend. People who are mindful of their health tend to cook at home more, so that could benefit Safeway and other grocers.
- United Natural Foods (Nasdaq: UNFI)
Food distributors should also benefit from a pick up in the grocery business. United Natural specializes in organic and natural foods. The timing is good here, too – shares got pounded on Tuesday after the firm’s earnings results fell below analysts’ expectations. That gives investors the chance buy at a lower price.
And despite the earnings miss, quarterly profits still climbed 15%. The company has also scooped up $100 million in new business over the past six months.
- Nash-Finch Company (Nasdaq: NAFC)
If you’re looking for a cheaper, smaller and more diversified food distributor, consider Nash-Finch. It sports a P/E ratio of just 9 and has a 2% dividend yield.
- Monsanto (NYSE: MON)
This agricultural powerhouse provides seeds and genomics to farmers. An increase in demand for vegetables should benefit Monsanto.
In my house, we’ve begun to change our diet and exercise habits. It’s not just that I want to feel good and save money on healthcare, I’m also vain enough to want to be the healthy guy in the commercial 30 years from now.
Hoping your longs go up and your shorts go down,
Marc Lichtenfeld
Editor’s Note: To keep up with all of Marc’s latest healthcare and biotech recommendations, be sure to check out his in-depth analysis in The White Cap Report.
You can take the service for a risk-free test drive and see for yourself how he’s nailed current winners of 114%, 42% and 37% – and what he’s got in store for investors next.
Not only that, you’ll get the latest picks from Louis Basenese – a small-cap expert who specializes in unearthing companies with unique, innovative, in-demand products and virtually no competition. You won’t find these firms anywhere near Wall Street’s wonky radar either. Check out all the details here.
- From Fat to Fit: Six Stocks Set to Profit From a Slimmer America
- These Healthcare Insurance Stocks Are Ready to Rise
- The Diagnostics Industry: Why Healthcare Reform Should Help These Companies
16 Responses to “The Best Kind of Healthcare Reform You Can Get”
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Marc Lichtenfeld is embedded in the biotechnology and healthcare sectors. As Healthcare Specialist for The White Cap Research Group, his days are spent tracking the clinical trials of various companies seeking FDA approval on pharmaceuticals, which oftentimes means interacting with CEOs of companies.
March 3rd, 2010 at 3:20 pm
I agree with your points about the need for preventative health and better health habits. Most of our chronic diesases are caused by diet and lifestyle. And trying to fix them with drugs and surgery is costly, dangerous, and doomed to failure from the start, since they don’t address the real causes.
In addition, when taken as a whole, the problems of hospital and doctor errors, infections contracted in hospitals, wrong medications, and combinations of prescription medicines are now the 4th leading cause of death. Our attempts to fix diet and lifestyle issues with drugs is not working.
The only point I don’t agree with it the assertion that the politicians are only bickering and jabbing each other. I think there is a real substantive debate on the subject of a totally government-run, socialized health care system, which one party advocates, versus an common-sense approach to making health care more affordable without adding another trillion to the deficit.
It really frustrates me to hear the media that is pro-Obama refer to the debate as just partisan wrangling, when the future of America is lterally in the balance, between a government takeover of another 16% of the economy, versus a sensible plan to improve the system that happens to be the best in he world. If Uncle Sam runs it, it will eventually become one of the worst healt care systems in the world.
I would think that your writers would be concerned about what this huge move into socialism the president is trying to ram through congress – against the will of the majority of Americans – would mean to the stock market.
the only way we can stop this unprecedented, rapid advance into European style socialism is to inform people about the fallacies it represents and encourage them to speak up to their elected representatives.
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Jerry Cole Reply:
March 3rd, 2010 at 4:20 pm
why is socialist health care good for all the senators, congressmen, president etc and all government employess but not for the rest of us?
plus our current health care system is not the best in the world it is rated 39 th behind one of the stan countries
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March 3rd, 2010 at 3:37 pm
I found it amusing that you would recommend Monsanto as a company that should benefit from a trend to healthier eating. If you talk to people who are really into eating healthy, organic foods, Monsanto is viewed as evil incarnate, spawn of the Devil, and several other more potent phrases, as a consequence of their drive to develop genetically modified plants that are immune to Monsanto herbicides such as Roundup. They also incorporate genetic modifications that make it impossible to save seeds from your harvest to plant the following season.
No, if people really start trying to educate themselves about healthy eating, and to eat a healthier diet, I don’t think Monsanto will benefit.
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Savers Reply:
March 7th, 2010 at 8:48 am
“evil incarnate, spawn of the Devil”
It’s true!! Read up on them.
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March 3rd, 2010 at 3:45 pm
Great article until you got to Monsanto. GM? Healthy?
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March 3rd, 2010 at 3:54 pm
It is not about eating healthy-this country is addicted to food like it is addict to the vices of smoking and drinking. Our elected representatives are addicted to the lobby money from the big overgrown pill pushers(that situation is impossible to overcome). Our doctors are trained not to prevent illness but to treat illness(I am pretty sure treating illnesses pays a lot better than preventing illnesses). I know of one women that has been receiving treatment for cancer for years(she is unemployed and poor)-to the doctors she is cash flow through the taxpayers or through the Fed’s money printing press. Will they ever quit finding cancer in her-not until she is dead-milking the system. It is now all about greed-pass a law-no more money spent on lobbying-fine would be death and the whole world quit buying US treasuries to get some fiscal order in our government(its going to happen anyway-just as well happen sooner then later the hurt will be less).
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March 3rd, 2010 at 4:14 pm
I was right with you until monsanto reared its ugly head. They are the mother of all that is evil. Please do some research on them before you keep recommending them
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March 3rd, 2010 at 4:57 pm
Marc,
There has NEVER been any testing for humans on the effect of these genetically modified plants. There is a reason why many countries do not want them. I question your investment ethics on investing in a company that wants to control and patent many of our food staples.
If you value your health and the freedom to grow organic foods, you should take action against Monsanto, not invest in them. Do the research and learn about this unethical company.
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LOUIS WITHERS Reply:
March 4th, 2010 at 3:28 am
a great article! to the point & such great info. thank u.
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March 3rd, 2010 at 5:59 pm
Marc Lichtenfeld:
Please stick with your excellent stock recommendations.
Your health care recommendations failed greatly because you included “Monsanto”.
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March 4th, 2010 at 9:56 am
Its my understanding that as long as alternative medicine is demonized by the drug companies through lobbied legislation that dictates that only a drug can cure a condition, people are actively being dissuaded from taking care of themselves.
Such ridiculous inventions as “”Acid Reflux Disease” – its not a disease in the accepted sense of the word, highlight the absurdity resulting from such legislation. I am not a doctor,nor do I dispense anything apart from the payments I make for natural supplements. It is astonishing that I may not discuss such things with my MD as he might lose his license if he condones my non-drug supplements.
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March 4th, 2010 at 10:11 am
There are many incentives for unhealthy living. Medical expenses can be written off your taxes. If you develop health problems as a result of alcoholism, overeating, or not exercising you can
quit working and collect disability for life….
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March 4th, 2010 at 10:28 am
I get what you’re all saying about Monsanto. When I was writing the article, I hesitated before I included Monsanto in the column for all of the reasons you’ve mentioned (and I agree with them). Ultimately, I concluded that most Americans don’t read labels or look too closely at the food they’re eating. The effort to eat more veggies will be enough for most people, so as a result, Monsanto would likely benefit. — Marc
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March 4th, 2010 at 11:31 am
It puzzling where this article is going, starting with a good, factual premise – America is obese. But choosing Monsanto as a savior of a world is shockingly naive. Obviously a concern about “ethical investing” hasn’t reached here yet.Obviously no research, on what Monsanto is doing, has been done. Monsanto is destroying the farming of the world, and lying, hiding the terrible data they have on the GMO. I don’t recommend that anyone invests in Monsanto, not only it’s equivalent of Hitler’s gas chambers (the facts are too voluminous to discuss here), but it’s bound for a unexpected setback, as the world is turning against them. They were already convicted in France, Italy, and several other EU states. India is reporting 100% falied crops (yes, 100%, not a typo) by their GM cotton.
BTW – where did you hear lately that exercise makes you lose weight, READ THE LATEST STUDIES, its not true, and exercise is the most dangerous hobby you can take up (10,000 people a year end up in emergency). Remember, 1 hour RUN (not jog) burns about 900 calories. Draw your own conclusions.
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March 9th, 2010 at 10:19 am
I agree with Gordan. Monsanto was not a good choice when writing an article about good health.
Their seed offerings include genetically modified
seeds. These are far from any interest of good health. As far as “health care” goes, it’s a
misnomer. It’s really “sick care”. True health
care is called prevention. Marc, this being said,
your article was basically very good.
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March 11th, 2010 at 7:52 am
How comforting to read all the comments on Monsanto. In the US we aren’t even allowed to label foods non GMO. This is free enterprise!?
Also, amen to Charlie in Comment 1. Unfortunately, the Clinton and both Bush administrations have pushed us toward this monstrous nightmare. The only highlight was (during the Clinton administration) the legislation allowing freedom for us to learn about supplements. This has been being fought by both the W and BHO administrations.
BTW both Fred Meyer and QFC have FAR better selections of whole foods than Safeway in this area. So maybe Kroger would be a better bet. I don’t know. I haven’t done any research.
I do enjoy your updates. Thank you very much.
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