So many of these are bordering on their 52-week lows from the bad old days. Others can't get out of their way even when the fundamentals are good: Baxter (BAX), Abbott (ABT), Bristol Myers (BMY).

On the vaccine side, companies like GlaxoSmithKline, Baxter(BAX) and Crucell(CRXL) stand to benefit, he said.

With double-digit earnings growth, a robust balance sheet and strong R&D efforts under way, Baxter could see its shares climb by nearly 20%, to 65, by year's end.

11

Healthcare
Alternates: AMGN, BSX

Baxter International (BAX), C.R. Bard (BCR), Teva Pharmaceutical (TEVA) and Express Scripts (ESRX) are four health-care stocks likely to outperform in the coming year, even if the global economy remains depressed. The company's geographic reach makes it less dependent on conditions in any one region. Baxter has "good earnings visibility, with little economic sensitivity," says Lai. "They have become less of a distributor of medical equipment like IV supplies, and more of an innovator." Behind that shift is Baxter's bioscience division, whose third-quarter revenue grew 23%, to $1.3 billion. Its products include plasma-based proteins used to treat hemophilia. Another promising area: recombinants, which are produced synthetically, not from human blood, and are used to treat immune disorders. Recombinant sales totaled $516 million in the quarter, versus $432 million a year before. "Between the therapies they have for hemophilia and immune-system-deficient patients, that's a very good market," says Willey. Baxter is also benefiting from a favorable shift in its product mix, as the fastest growth is coming from its more profitable products in biosciences.

20%

Based in Deerfield, Ill., Baxter sweetened its quarterly 20%, to 26 cents a share from 21.75 cents, payable Jan. 6 to holders of record Dec. 10. The ex-date is Dec. 8. This is the third hike since February 2007, and gives the stock a 1.71% yield. Dividends have been ongoing since 1934. Baxter, which set a 52-week high of 71.53 on the Big board Aug. 15, was recently quoted at about 61 and is rated Buy. Third-quarter diluted earnings surged 21%, to 74 cents a share from 61 cents a year earlier. Sales rose 15%, to $3.2 billion. Commenting on the dividend boost, CEO Robert L. Parkinson Jr. said: "Because of the medically necessary nature of our product offerings, diversified business portfolio and extensive global presence, we have the financial strength and flexibility to provide enhanced value to shareholders and invest in future growth despite the uncertain macro environment."

great company with near recession proof market

Competitor

don't know where it's hitting next