This often overlooked sector may be the most evergreen

But caution should still be exercised, analysts say.

Stability may be a pipe dream for Singapore’s economic sectors due to the economic slowdown, but one segment has maintained steady outperformance despite the headwinds.

According to Maybank Kim Eng, healthcare stocks have outperformed recently, and should remain resilient due to their defensive nature and structural growth outlook.

“While investors looked past 3Q15 earnings misses for 2 out of the 4 stocks under coverage, the forward P/E of >30x appears rich,” Maybank Kim Eng said.

Meanwhile, Maybank Kim Eng still advises caution, as poor project execution and delays in M&A could lead to a valuation de-rating.

“Companies must select the right partners, set achievable targets, and be prepared for regulatory uncertainty, while remaining nimble amid variable economic growth,” Maybank Kim Eng said.