Goldman Sachs says the world is aging and demographic changes present “significant” investment opportunities. Birth rates are decreasing and people are living longer, resulting in a larger proportion of the total population being older. Analyst Evan Tilenda, head of EMEA at Goldman Sustain, the firm’s investment research team dedicated to finding the best environmental, social, and governance (ESG) investments, estimates that by 2050, the world’s population will It said it is expected to increase by 20%. However, the number of people aged 65 and over is expected to double from 800 million to 1.6 billion over the same period, according to United Nations data. “In developed markets, consumption habits change as individuals age and also vary by generation, impacting growth and investment opportunities,” Tilenda said in a report last Wednesday. He added: “In both the United States and Europe, older people spend a higher proportion of their total expenditures on health care and housing, and less on transportation, insurance and pensions.” Goldman sees tailwinds in three areas: healthcare, senior living and care, and entertainment and experiences. Healthcare As people get older, healthcare spending increases as they deal with more medical problems such as heart attacks, hearing loss, diabetes, and depression. In 2021, people over the age of 65 will account for 18% of the population in the U.S., but health care spending will decrease even though people 65 and older make up 18% of the population, according to a KFF analysis of the Health Expenditure Panel Survey, a nonprofit organization conducted in partnership with the Peterson Institute. This accounted for 36% of the total. Focusing on healthcare. A separate analysis of data from the Institute for Health Metrics and Evaluation by Goldman found that personal health spending per person over age 60 in the United States increased by about 2,400% for cardiovascular diseases, 970% for neurological diseases, and 550%. It turned out that there was. Below are some of the health care stocks that Goldman believes will benefit from this trend. Investment banks have rated both stocks as “buys.” Senior Living and Care As people age, they seek ways to remain in their homes as long as possible or move into senior housing. This means increased demand for nursing homes, nursing homes and long-term care facilities, as well as home care and rehabilitation services. Goldman rates BrightSpring Health Services, one U.S.-based company that will benefit from this trend, as a buy. Louisville-based Brightspring, which went public a year ago in a Goldman-led IPO, provides community and home health services, as well as infusion services, specialty pharmacy and rehabilitation care. BTSG 1Y Mountain Brightspring Health Services for the past year. There are several real estate investment trusts that offer senior living, such as Welltower and Ventas, but Goldman doesn’t carry them. Welltower’s average analyst rating is “overweight,” according to FactSet, and Wall Street expects the stock to rise 14% over the next 12 months, based on analysts’ consensus price targets. Ventas also has an average Overweight rating, with about 21% upside potential from its average price target, according to FactSet. Entertainment and Experiences Finally, Tilenda said older generations prefer to spend their money and time differently than younger generations. Her research found that leisure activities such as recreational vehicle use, cruises, and motorcycle rides are more common among people nearing and older than retirement age. They are also more likely to own pets early in life and allocate more spending to animals, he said. Goldman rates Norwegian Cruise Line, Carnival Cruises, and Royal Caribbean Cruises as buys. Pet e-commerce company Chewy also rates it a buy. Cruises, which often cost less per night than land-based accommodation, have seen a surge in demand since the coronavirus pandemic shut them down.
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