Healthcare companies saw significant cash flow growth in 2016

After falling behind 2015 results in the first half of last year, healthcare companies' financial performance rebounded in the second half of 2016, according to a recent Willis Tower Watson report.

Income statement performance and balance sheet returns were largely flat across the healthcare sector in 2016, while cash flow growth showed significant improvement. The increase was fueled by healthcare equipment and supplies companies' 18 percent year-over-year gains in cash flow growth, according to the report.

Total shareholder gains declined in 2016, which was largely attributable to stock price decreases for pharmaceutical, biotechnology and life sciences companies in the second half of last year. Although shareholder returns rose 2 percent from Nov. 7 to Dec. 30, "investors maintain a vigilant watch over the regulatory environment for the healthcare sector in 2017 due to uncertainties created by the new administration," according to the report.

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