Healthcare Stocks Hold Up as Wall Street Awaits Rate Hikes

As Wall Street waits for the Federal Reserve's next move on interest rates, several healthcare stocks are proving more resilient to rising costs. Eli Lilly, Medtronic, and Johnson & Johnson are three companies in this sector that may be worth a closer look.

Eli Lilly is leading the market with its GLP-1 weight-loss drugs, which now account for nearly 66% of its top line. The company is generating huge amounts of cash from these medications, allowing it to diversify its drug pipeline. In August 2026, Eli Lilly agreed to acquire Merida Biosciences, and in July 2026, it acquired AtaiBeckley, expanding into the mental health space.

Medtronic's turnaround story appears to be well underway, with key new products likely to power its future. The company has slimmed down its business to focus on its most profitable and fastest-growing divisions, investing more heavily in new products. In fiscal 2026, Medtronic's sales grew 8.4%, the fastest pace of growth in a decade.

Johnson & Johnson is a diversified healthcare giant operating in both pharmaceuticals and medical devices. The company has been slimming down by spinning off or selling divisions to focus on its most profitable businesses. Its dividend, increased annually for over six decades, offers investors broad exposure to the healthcare sector and a historically well-run business.