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The world’s population is ageing – 3 share ideas which could benefit

A world with older people as the majority could be very different to what we see today. With this demographic shift in mind, we look at three well-positioned share ideas which could benefit from the growing silver economy.
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Important information - This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

The world’s population is changing. Fewer children are being born and people are living longer.

Predications put the number of people aged 65 and over worldwide doubling by 2050, reaching 1.6 billion. This is most pronounced in Hong Kong, South Korea and Japan, but Europe is facing similar challenges.

A world where older people are the majority could be very different and creates unique challenges for the economy, public services, and pension systems. However, it also creates substantial opportunities for certain businesses.

With this demographic shift in mind, here are three companies that could be well-positioned to benefit from the growing silver economy.

This article isn’t personal advice. If you’re not sure an investment is right for you, seek advice. Investments and any income from them will rise and fall in value, so you could get back less than you invest. Yields are variable and no dividend is ever guaranteed – financial figures also shouldn’t be looked at on their own.

Investing in an individual company isn’t right for everyone because if that company fails, you could lose your whole investment. If you cannot afford this, investing in a single company might not be right for you. You should make sure you understand the companies you’re investing in and their specific risks. You should also make sure any shares you own are part of a diversified portfolio.

Remember, before you can trade US or Canadian shares, you need to complete and return a W-8BEN form – this entitles you to save tax on any dividends. Tax rules can change, and benefits depend on personal circumstances.

3 share ideas



Medtronic operates in the medical devices industry, providing leading solutions across Cardiovascular, Medical Surgical, Neuroscience, and Diabetes.

Despite pandemic-related challenges like delayed surgeries, the industry is still showing robust structural growth. This resilience is being driven by ageing populations in developed markets, like Asia, and increasing wealth in the developing world.

As populations age, the demand for medical devices and healthcare solutions tailored to older adults is expected to rise.

Cardiovascular diseases, like coronary heart disease, are the leading cause of death worldwide, and become more common with age. Making up over a third of revenues, Medtronic’s strong cardiovascular pipeline, which includes innovations like transcatheter valves and leadless pacemakers, positions it well to meet this growing need.

The company holds the number one or number two position in many of its key markets, and the opportunity in the rapidly growing diabetes space is something to watch.

The number of diabetics globally is expected to grow at a 2.2% compound annual growth rate (CAGR) to 2028 – and Medtronic's advancements in insulin delivery systems, like its FDA-approved MiniMed 780G insulin pump, could capture a significant share of this market.

Emerging treatments might reduce the dependence on insulin injections for patients in the future. But for now, the addressable market remains large, with 70% of American diabetics still relying on multiple daily injections rather than automated insulin delivery systems.

With 130 product approvals over the last 12 months, it’s excelling at the speed of innovation, but it hasn’t come cheap. Operational costs have been increasing and margins have come down.

It still has industry-leading margins and we think its favourable valuation, combined with a decent dividend yield at 3.7% and a robust balance sheet, positions it as a defensive, high-quality, low-growth compounder – of course no returns are ever guaranteed.

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Novo Nordisk

Novo Nordisk is a pioneer in diabetes-care products like insulin.

In the market for over 85 years, it claims over a third of the $50bn diabetes treatment market and roughly half of the $15bn insulin market.

Currently, the key growth driver is its range of GLP-1 products for the treatment of type two diabetes, and more controversially used as a weight-loss aid.

Novo's Wegovy is making strong inroads in obesity treatment and is poised to remain a key drug in major markets until patent expiration in 2032. With a solid pipeline of GLP-1 products, Novo is well positioned to defend its formidable diabetes market share.

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But beyond the more established use cases for diabetes and obesity, there are early signs that GLP-1 could also be used to tackle major conditions like chronic liver and kidney disease, Alzheimer’s, and heart failure.

There’s a high degree of execution risk to bring any of these products to market, but if successful, they have the potential to be blockbuster treatments.

High prices and strong growth have attracted competition.

As well as big players like Eli Lilly, generic manufacturers, particularly in China where patents run out sooner are waiting in the wings. High prices also haven’t gone unnoticed in political circles. Particularly in the US where over half of sales are made, price-related drug policy reform is expected to cause downward pressure.

Given the relatively short history of GLP-1s, another risk is the potential emergence of long-term side effects.

Novo boasts operating profit margins consistently over 40%. There are some headwinds to margins as Novo seeks to internalise more of its supply chain and drive the research agenda. However, management are confident it can grow more.

The balance sheet is also in good shape, with little debt and strong free cash flows. This positions them well to invest internally and seize on strategic opportunities.

But these qualities come at a premium.

With a valuation sitting some way above the long-term average, there’s real pressure to deliver. Despite expected price declines and competition, we’re excited about the long-term potential, but the likelihood of ups and downs remains elevated.


Primary Health Properties

Primary Health Properties (PHP) operates healthcare facilities in the UK and Ireland and has a long track record of delivering results for shareholders.

A growing focus on community-based health services and the needs of an ageing population means investment in primary care facilities isn't going anywhere.

The topic isn’t far from the political spotlight, and 2024 General Election pledges to invest in new GP surgeries and existing facilities should act as a favourable backdrop to PHP’s growth strategy.

Unlike typical commercial real estate which has been volatile of late, PHP’s healthcare focus gives it a degree of protection. With 89% of the group’s rent coming from the NHS or Ireland’s equivalent, it doesn’t face the same risks of non-payment or buildings going unoccupied.

Government bodies also want security so are willing to sign up to longer leases and upward rent revenues, which provide PHP with strong visibility and more stable asset values.

As a REIT (Real Estate Investment Trust) company, it’s primarily focused on returning rental income to shareholders through dividends – the shares currently have a prospective yield of 7.6%.

Despite its strengths, there are reasons for caution.

Loan-to-value (LTV), which measures a REIT’s debt leverage is high by industry standards and has risen over the past three years. It’s at the top end of its target range. But with asset values needing to fall by almost 40% for covenants to be impacted, it’s not an immediate cause for concern.

PHP’s valuation looks undemanding and the prospective dividend yield is attractive at 7.6%. The valuation, which has come under pressure lately, now stands at less than the company's net asset value, or the value of all its assets less all its liabilities. This could present an interesting opportunity for investors.

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This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated, estimates, including prospective yields, are a consensus of analyst forecasts provided by Refinitiv. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.

This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication. Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing. Please see our full non-independent research disclosure for more information.

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Written by
Derren Nathan
Derren Nathan
Head of Equity Research

Derren leads our Equity Research team with more than 15 years of experience in his field. Thriving in a passionate environment, Derren finds motivation in intellectual challenges and exploring diverse ideas within his writing.

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Article history
Published: 4th July 2024