The S&P 500 Health Care index dropped 12% in the last year, trading at a steep discount to the market. AbbVie and Johnson & Johnson outperformed their sector, with strong quarterly results and market values of $366.6 billion and $429.7 billion. August could mark a turnaround month for healthcare, boosting these companies’ potential.

AbbVie, a global drugmaker, is shifting to next-generation therapies with a diverse portfolio. ABBV stock has shown steady momentum, up 5.59% in the past year. The company boasts a strong dividend yield of 3.11%, consistent cash generation, and disciplined capital returns.

AbbVie’s second-quarter results saw adjusted EPS of $2.97, up 12.1% year over year, with solid revenue growth. Recent moves, like the Capstan Therapeutics acquisition, strengthen the company’s long-term story. Analysts rate the shares a consensus “Moderate Buy” with a mean target price of $215.81.

Johnson & Johnson, a major healthcare player, has shown steady growth, climbing 7.16% in the past year. The company offers a reliable dividend with a yield of 3.58% and a long streak of dividend increases. In the second quarter of 2025, sales were nearly $23.7 billion, showing strong performance across core businesses.

Johnson & Johnson MedTech launched the VIRTUGUIDE AI-powered Lapidus system to streamline bunion surgery planning. The company also expanded its global initiative to support the nursing workforce. Analysts rate the stock a consensus “Moderate Buy” with an average target price of $177.36.

Both AbbVie and Johnson & Johnson offer clear earnings momentum, durable cash returns, and growth catalysts. AbbVie’s immunology engine and recent moves enhance its outlook, while Johnson & Johnson’s steady growth and innovative products in both medicine and MedTech make them smarter-value buys than UnitedHealth at this stage.

Read more at Yahoo Finance: These 2 Healthcare Stocks Are Even Better Bargain Buys Than UnitedHealth