US care sector – performance diverges as home healthcare expands
by SUHAIL MIRZA
The US stock market has had investors holding their breath this year. Since 9th March all three indexes have experienced massive upward swings. The Dow Jones and S&P500 have climbed 26% and 30% respectively and the NASDAQ (traditionally the home of newer more technology biased businesses) has jumped almost 36%.
Some commentators are calling the end of the savage bear market which began in the summer of 2007 although it should remembered that the Dow and S&P remain, for example, 40% below their July 2007 highs.
The US listed social care sector has clearly been affected by the above gyrations in the markets although it is intriguing to note how different segments within the market have performed.
In broad terms the sector benefits from strong fundamentals. The prime target group for nursing homes are the over 85s. That population is expected to grow 80% by 2030 and reach 9.6 million. Nursing home spending is forecast to reach $210.9bn a year by 2016; a substantial increase given the figure f