PROFITABILITY IN THE HEALTH CARE SECTOR 1998-2012
Independent thesis Basic level (degree of Bachelor), 10 credits / 15 HE creditsStudent thesis
Data shows that the expenditure on health care as a share of GDP has increased significantly in many countries since 1960. Since it can be difficult to make predictions about the future, looking into the history is often a good alternative that can offer potential answers to a question of interest. From an investment perspective, it is interesting to examine how the profitability in the health care sector has evolved in the past. The results will make it possible to distinguish if the profits in the sector have been increasing, decreasing or remained constant while the expenditure has increased. By examining the historical development together with the characteristics and future outlook of this industry, it may be possible to develop an understanding of the reasons behind the results but also to predict something about the future . By aggregating available data of 100 companies, which can be seen as representatives of the health care sector, it is possible to calculate the profitability in the industry since 1998. The two measures net profit margin and operating profit margin are appropriate to study. These margins show that the profits in the sector have been fluctuating during the last 15 years, most recent with a decline in 2012. The net profit margin has fluctuated more than the operating profit margin, which can be seen as relatively stable during the years in focus. The aggregated net profit margin was approximately 9.09 percent in 2012, which can be compared to 9.43 percent in 1998. The operating profit margin was 14.32 percent in 2012 and 14.10 percent in 1998.
Place, publisher, year, edition, pages
health, health care sector, medical sector, expenditure, demand, demographic transition, aging population, profitability, investment
IdentifiersURN: urn:nbn:se:uu:diva-203594OAI: oai:DiVA.org:uu-203594DiVA: diva2:637050
Lyhagen, Johan, Professor
Ohlsson, Henry, Professor