iShares US Pharmaceuticals ETF

IHE

Market cap $802M

iShares U.S. Pharmaceuticals ETF is rated a buy, driven by strong growth and dividends from top holdings like Eli Lilly, JNJ, and Merck. IHE's top holdings, particularly LLY, JNJ, and MRK, offer diverse product lines, robust earnings, and expanding dividends, supporting future performance. Despite IHE's high expense ratio and sector concentration, the growth and profitability of its largest components outweigh these drawbacks.

Pharma ETFs like IHE and PPH are rallying as strong Q3 earnings across major pharmaceutical companies lift sector sentiment.

The healthcare sector has experienced one of its most significant de-ratings in 35 years, with valuations now at a 30% discount to the broader market. Healthcare trades at historical valuation discounts across multiple metrics.

Pharma giants Eli Lily ( LLY ) and Novo Nordisk ( NVO ) have signed deals with U.S. President Donald Trump to slash the prices of some of their obesity drugs, including upcoming pills, as per a White House announcement made late last week. This comes as part of the Trump administration's Most-Favored-Nation (“MFN”) drug pricing policy that aims at forcing U.S. drug prices to match the lowest prices available in other advanced countries.

Investors seeking momentum may have iShares U.S. Pharmaceuticals ETF IHE on radar now. The fund recently hit a new 52-week high.

Pharma's Trump-Pfizer boost sparks momentum, making ETFs PPH, IHE, PJP & XPH attractive for defensive, undervalued growth plays.

Drugmakers have been bracing for levies and sought to get ahead of them with pledges to invest billions more on domestic manufacturing.

President Donald Trump said Thursday that he will put import taxes of 100% on pharmaceutical drugs, 50% on kitchen cabinets and bathroom vanities, 30% on upholstered furniture and 25% on heavy trucks starting on Oct. 1.The posts on his social media site showed that Trump's devotion to tariffs did not end with the trade frameworks and import taxes that were launched in August, a reflection of the president's confidence that taxes will help to reduce the government's budget deficit while increasing domestic manufacturing.While Trump did not provide a legal justification for the tariffs, he appeared to stretch the bounds of his role as commander-in-chief by stating on Truth Social that the taxes on imported kitchen cabinets and sofas were needed “for National Security and other reasons.”Under the Trade Expansion Act of 1962, the administration launched a Section 232 investigation in April about the impacts on national security from pharmaceutical drug and truck imports.

Pharmaceutical stocks mostly gained Friday, as traders appeared to shrug off or even cheer President Donald Trump's rollout of a new tariff plan for drugmakers.

Trump's 100% tariff on imported drugs jolts markets, slamming pharma giants and dragging ETFs like XPH, FTXH, IHE, and PPH lower.