BME - BME: Future Interest Rate Cuts May Be A Catalyst
2024-07-17 05:28:15 ET
Summary
- BlackRock Health Sciences Trust trades at an attractive discount to net asset value.
- The dividend yield of 6.1% remains supported from net investment income. Some weakness revolves around the use of return of capital, however.
- Future interest rate cuts may serve as a price catalyst. Inflation continues to cool while the unemployment rate ticks upward.
- The dividend has not been cut over the last decade, which offers stability and a reliable source of distribution income through health care exposure.
Overview
When I previously covered BlackRock's Health Sciences Trust ( BME ), I discussed how the fund traded at a historical discount to NAV, which justified my strong buy rating. While BME still trades at a discount to NAV, I wanted to provide some updated insights around following macroeconomic conditions that may serve as a catalyst for the health care sector. As a result, I believe that BME can experience a price recovery and some meaningful NAV growth as conditions start to improve....
BME: Future Interest Rate Cuts May Be A Catalyst