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4 Stocks to Profit From ACA's Next Phase

Merck, Roche, Express Scripts, and LabCorp stand to benefit from an increased focus on cost control and improved outcomes, says Morningstar's Debbie Wang.

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Debbie Wang: The first five years of the Affordable Care Act were really focused on increasing accessibility to health care. Now, we're moving into the next phase, which is concentrated on cost control and improved outcomes.

With those two goals in mind, we actually have four names that jump out at us as companies that will benefit in this new phase; the first two are Merck (MRK) and Roche (RHHBY). These are two companies that, in their pipelines, have a number of therapeutic agents that will make a big difference on the quality side, meaning they will deliver better health outcomes. We think those shares are all undervalued right now.

Debbie Wang does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.