Healthcare Stocks Are Bleeding Out — And I’m Still Holding the Scalpel

If you’ve been anywhere near a stock chart lately, you’ve probably noticed the healthcare sector is currently doing its best impression of a skydiver without a parachute. The sector that’s supposed to be a “safe haven” in turbulent markets has turned into a live reenactment of the Titanic’s final act. And yet… I’m still here. Still holding my shares. Still sipping coffee.

Why? Because I own UnitedHealth (UNH) and Novo Nordisk (NVO) in my long-term portfolio, and I’m not in the habit of dumping good companies just because the market’s having a temper tantrum. Also, Warren Buffett just backed up the truck and bought an enormous pile of UNH. And if the man who literally is value investing sees something worth buying here, maybe the rest of us should calm down.

The Sector’s “Safe Haven” Reputation Just Got Mugged

Healthcare has always sold itself as recession-proof. People get sick whether GDP is up, down, or sideways. Insurers keep collecting premiums. Drugmakers keep selling pills, injections, and miracle cures at mark-ups that make jewelry stores jealous.

But here’s the ugly truth right now:

• Costs are spiking. Everything from wages to raw materials for drug manufacturing has gone up. Even syringes cost more.
• Regulators are circling. The U.S. and EU have both turned their microscopes onto pricing, reimbursement rates, and insurance company profits. Politicians love a good “Let’s take on Big Pharma” headline.
• Interest rates are a silent killer. Higher rates mean more expensive debt and less patient capital for long-term R&D projects.

The result? Investors suddenly remembered that “recession-proof” doesn’t mean “bulletproof.” And the whole sector’s valuation is catching a beat-down.

UnitedHealth: The Blue-Chip in the Crosshairs

Let’s start with UNH. Over the last year, it’s been one headline disaster after another:

• A massive cyberattack that cost millions to fix.
• A tragic loss of a senior executive.
• Rising medical cost ratios that spooked the entire insurance industry.
• Federal investigations that sent compliance lawyers into overtime.

The stock dropped over 45% from its highs — the kind of plunge that turns even long-term investors into compulsive chart-checkers.

And then… enter Warren Buffett. His Berkshire Hathaway quietly scooped up over 5 million shares of UNH in Q2 2025 — a stake worth roughly $1.6 billion. That’s not a “just testing the waters” buy. That’s a “full-on cannonball into the deep end” buy. And like clockwork, the Buffett Effect kicked in: the stock bounced over 10% in the days after the news broke.

I’ve held UNH for years, collecting dividends while the stock steadily climbed. And here’s the fun part:

If you’d bought $10,000 of UNH ten years ago at around $80/share, you’d have gotten roughly 125 shares. In 2015, the annual dividend was about $2.50 per share. Today, it’s over $8.60. Over the decade, those payouts (especially reinvested) would have returned roughly your entire initial investment — before even counting capital gains. That’s what dividend growth actually means.

Novo Nordisk: The Danish Golden Child Having a Bad Week

Novo Nordisk was the poster child of the “obesity and diabetes miracle drug” boom. Wegovy and Ozempic were household names, the share price was soaring, and for a while it seemed like NVO could do no wrong.

Then came the reality checks:

• Eli Lilly showed up with Mounjaro and Zepbound, stealing headlines and market share.
• Sales growth slowed as the easy wins in the obesity market were taken.
• The CEO chair changed hands at the worst possible moment, introducing uncertainty.

The stock dropped about 20% in a flash after cutting guidance.

And yet — if you’d bought NVO ten years ago, the dividend story is almost as sweet. In 2015, the annual payout was around $0.40. Today it’s about $1.60. That’s a 4x payout increase in a decade, plus serious share price appreciation. If you reinvested those dividends, you’d be well on your way to “free shares” by now.

The Ten-Year Test: Dividends as a Time Machine

Here’s the part where people who sold last month start crying into their brokerage statements.

If you’d bought both UNH and NVO in equal amounts ten years ago and just sat on them, reinvesting dividends, you’d be looking at:

• UNH: Dividends nearly covering your original cost, with capital gains stacked on top.
• NVO: Payouts quadrupling, effectively cutting your payback period in half.

No day-trading, no panic-selling, no “I read this one guy on Reddit” investment strategy. Just boring, relentless compounding.

So Why Is the Sector Bleeding Now?

It’s not just my two darlings. Across the sector, healthcare providers, insurers, and big pharma are all taking hits. Here’s why:

1. Margins under attack. Regulators are tightening reimbursement rates and cracking down on surprise billing. That hits insurers and hospitals right in the bottom line.
2. Political football. Healthcare is an election-year punching bag in the U.S., and every soundbite about “reining in costs” makes investors twitchy.
3. R&D uncertainty. Drug pipelines take years to develop, and higher interest rates make financing more expensive.

Put simply: short-term headwinds are blowing hard enough to make even strong ships wobble.

The Reasons to Hold — Even Now

I’m not here to tell you everything’s fine. It’s not. Volatility sucks. Watching your portfolio drop 20–40% isn’t fun. But there are still big reasons I’m holding my healthcare positions:

• Essential demand. People don’t cancel their insulin prescription because the Fed raised rates.
• Dividend growth track records. Both UNH and NVO have consistently raised payouts for over a decade.
• Buffett’s buy. The man didn’t just nibble at UNH — he loaded up like it was the last buffet before closing.
• Discounted valuations. Buying high-quality companies when everyone else is running for the exits has historically been a good long-term move.

The Risks You Can’t Ignore

Holding doesn’t mean holding blindly. There are real threats here:

• Policy changes. A single piece of legislation can knock billions off a company’s market cap.
• Competition. In pharma especially, the next big drug can come from nowhere.
• Execution risk. Even great companies screw up (see: cyberattack at UNH).

These aren’t “ignore and hope” risks — they’re “watch like a hawk” risks.

The BloodyFinance Take

The healthcare sector right now is like a patient with a broken leg: it’s limping, it’s in pain, but with the right care, it will heal. UNH and NVO are still world-class operators with products and services that people literally can’t live without.

And if Buffett’s willing to commit over a billion dollars to UNH while the headlines scream doom, I’m happy to keep collecting my dividends, reinvesting them, and letting time do the heavy lifting.

If you wanted instant gratification, you’d be in meme stocks. If you want to build wealth, you buy great companies, hold them through ugly times, and enjoy the day when the same people who sold in a panic start buying back in at higher prices.

Remember – keep reading, keep growing. Bloody Finance.