The earnings season in the U.S. is about to end. By the end of last week, 87% of the S&P 500 companies had reported their results. According to data from FactSet, the blended earnings decline for the first quarter of 2016 was 7.1%. The figure was worse in the week before though.
In the previous week, the blended earnings decline for the quarter was 7.7%. The improvement was mainly due to some positive surprises from healthcare companies, which reported in the last week. Earnings of all major U.S. pharma companies, including Pfizer Inc. (NYSE: PFE) and Merck & Co. (NYSE: MRK) surprised on the upside. Indeed, this might be a good time to consider the BMO Equal Weight U.S. Healthcare Hedged To CAD Index ETF (TSX: ZUH).
The ETF made a disappointing start to the year as sentiment on the U.S. healthcare sector turned negative amid concerns over valuation. However, in the last three months, ZUH has rebounded sharply, gaining more than 10%. Year-to-date, the ETF has fallen more than 5%. In the last five years, ZUH has returned almost 110%, outperforming the S&P/TSX Composite Index.
