Buy this stock set to plug a ‘massive skills gap’ in aging America, fund manager says
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There’s one stock that resonates the most for fund manager Dani Saurymper as social trends shift amid an aging population. It’s U.S. education firm Adtalem , said Saurymper, who manages Pacific Asset Management’s Longevity & Social Change Fund. “This isn’t necessarily the biggest holding in the portfolio, but it’s the one for me that really resonates the most in terms of the theme about social change, demographic shift, and it comes back to industry and it comes back to people,” Saurymper told CNBC Pro Talks last week. The company is the top provider of nursing degrees in the U.S., and among the top providers for medical and veterinary degrees. As such, it’s well placed to plug the “massive skills gap” in the health care industry, according to Saurymper. “There is an acute shortage of doctors and nurses in the U.S. right now. There’s a predicted shortfall of about 400,000 nurses by 2025,” he said, adding that a third of U.S. doctors will be over the age of 65 by the end of the decade. “[There is] massive skills gap just at the time when more and more of the population [is] entering 65 and older, when they’re going to need to consume more health care,” said Saurymper. “So they absolutely have the end markets to be successful.” Health care and beyond He also likes the education theme for the life-long learning component. “We’re going to have a much longer middle life,” he said. “Chances are, we need to leave education at 20 and probably won’t retire until at least 70.” Saurymper’s $53 million fund invests in many sectors catering to an aging population. As well as health care and pharmaceutical stocks, its holdings span fitness and nutrition, personal care, aesthetics and financials. In terms of investment opportunities, finding companies with strong growth driven by the sick, aging demographic is the “first port of call,” he said, citing the “big diseases of aging” in particular: diabetes, cancer, heart attacks, strokes, dementia, and arthritis. “Now I think about health care along the lines of units of health care, rather than a drug. Maybe it’s a medical device, maybe it’s a patient monitoring. Equally, there’s obviously … this excitement in the biotech world, looking at stem cell therapy, rejuvenation of body parts, not just replacement of your hip or knee,” Saurymper said. “So there’s a lot to touch on within health care.” However, key industries exposed to the aging population go beyond the challenges of aging, he added. “So one of the big parts of our investment opportunity set is the education and well-being sort of universe,” said Saurymper.
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