Pro Picks: 3 Defensive Healthcare Stocks

Top ideas from Rob Moffat of Middlefield Group

Pro Picks: 3 Defensive Healthcare Stocks

Markets are volatile, healthcare is in the spotlight, and investors are looking for safe havens. In this episode of In the Money with Amber Kanwar, healthcare portfolio manager Rob Moffat of Middlefield breaks down the political and macroeconomic headwinds reshaping the healthcare sector—from RFK Jr.’s controversial stance on vaccines to looming pharmaceutical tariffs and the pressure on drug pricing.

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1. Eli Lilly (LLY)

• A global leader in weight loss and diabetes drugs, with blockbuster GLP-1s Zepbound and Mounjaro.

• Recently overtook Novo Nordisk with over 50% market share in the GLP-1 space.

• Revenues from obesity and diabetes expected to double to $35B+ in the next 3–5 years.

• Guided for 20%+ annual earnings growth over the next five years.

• Stock is down ~20% from highs due to tariff fears and supply chain volatility—setting up a buying opportunity.

Rob says: “Lilly has the better drugs and the better strategy. This is my #1 healthcare holding.”

2. Abbott Labs (ABT)

• Medtech rebound play as focus shifts from pandemic diagnostics to devices like the Libre 3 CGM.

• Libre now rivals Dexcom in accuracy, with broader access through pharmacies and better UX.

• Diabetes business grew nearly 20% this quarter and could double in 5 years.

• OTC CGM product “Lingo” taps into wellness trends among non-diabetics.

Rob says: “Abbott’s diabetes tech is just getting started—and complements Lilly’s GLP-1s.”

3. McKesson (MCK)

• Quiet giant in drug distribution, handling over 90% of U.S. medicine alongside two other players.

• Profits from a stable spread on drug delivery—but growth is being driven by complex, high-value specialty drugs like GLP-1s.

• Projected 12–14% annual earnings growth, with steady margin expansion.

• Shares remain attractively valued and have shown strong resilience in recent market volatility.

Rob says: “It’s boring—but beautiful. A steady compounder with upside in a defensive corner of healthcare.”

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