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Healthcare ETF (IHF) Tops in October: 5 Best Stocks

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iShares U.S. Healthcare Providers ETF (IHF - Free Report) topped the list of best-performing equity ETFs in October, gaining 11.1%.

Healthcare, which has been the second-worst performer among the 11 major S&P 500 sectors this year so far, took center stage last month. The outperformance can be attributed to positive news flow, including trial results and deal activities. In particular, Biogen (BIIB - Free Report) spread optimism following its Alzheimer’s treatment report. Further, better-than-expected corporate earnings added to the strength (read:  Healthcare ETFs Win in October: Here's Why).

Let’s take a closer look at the fundamentals of IHF.

IHF in Focus

This fund offers exposure to companies that provide health insurance, diagnostics and specialized treatment. It follows the Dow Jones U.S. Select Healthcare Providers Index, holding 49 securities in its basket with higher concentration on the top two firms. From an industrial look, managed healthcare takes the largest share at 48.5%, followed by healthcare services (35%) and healthcare facilities (12.7%). The fund has amassed $800.8 million in its asset base, while volume is moderate at about 78,000 shares per day on average. It charges 43 bps in annual fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

Though most of the stocks in the fund’s portfolio delivered strong returns, a few were up more than 15% in October. Below we have highlighted the five best-performing stocks in the ETF with their respective positions in the fund’s basket (read: 5 Best Sector ETFs of October With Double-Digit Returns):

Best Performing Stocks of IHF

Teladoc Health Inc. (TDOC - Free Report) : This company provides virtual healthcare services on a business-to-business in the United States and internationally. Its shares jumped about 24.5% in October. Olympic Steel currently has a Zacks Rank #3 (Hold) and VGM Score of C. The stock makes up for 1.25% share in IHF basket.

Centene Corporation (CNC - Free Report) : This company operates as a diversified and multi-national healthcare enterprise that provides programs and services to under-insured and uninsured individuals in the United States. The stock occupies the fourth position in IHF portfolio with 5% share and gained 24.2% last month. Centene carries a Zacks Rank #3 and has a VGM Score of A (see: all the Healthcare ETFs here).

Tenet Healthcare Corporation (THC - Free Report) : This company operates as a diversified healthcare services company. The stock has a Zacks Rank #1 (Strong Buy) and VGM Score of A. It delivered incredible returns of 23.2% in October and makes up 0.7% of IHF. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cigna Corporation (CI - Free Report) : This health service organization provides insurance and related products and services in the United States and internationally. The stock climbed about 19.6% last month. It currently carries a Zacks Rank #3 and has a VGM Score of B. Cigna occupies the fifth position in the fund’s basket with 4.7% allocation.

NeoGenomics Inc. (NEO - Free Report) : This company operates a network of cancer-focused genetic testing laboratories in the United States; and laboratories in Switzerland and Singapore. The stock rallied 18.4% in October and makes up for 0.61% of IHF’s assets. NeoGenomics has a Zacks Rank #4 (Sell) and a VGM Score of D (read: ETFs to Gain From the Booming Genomics Market).

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