NEW YORK ( TheStreet) - HCA Holdings ( HCA), Thermo Fisher ( TMO), Covidien PLC ( COV), Mednax ( MD), Bio-Rad Labs ( BIO), Pharmasset ( VRUS), Unitedhealth Group ( UNH), Sironal Dental ( SIRO), Illumina ( IIMN) and United Therapeutics Corporation ( UTHR) have an average buying rating of 85%, according to a Bloomberg consensus.

The S&P Global Healthcare Sector ETF ( IXJ), an indicator for the performance of health care stocks outperformed the S&P 500 INDEX by about 600 basis points in the last seven months. The S&P Healthcare Sector ETF moved up 6.5%, while S&P Index was more or less flat during this period. The relative low volatility of these stocks compared to broader indices augurs well for the sector, given the current market scenario.

We have identified 10 health care stocks which, according to analysts, could outperform their peers and broader market indices. These stocks have upside potential of 28% to 47% with a mean upside value of 33%.

By contrast, pharma giants Johnson & Johnson ( JNJ), Abbott Laboratories ( ABT), Bristol Myers Squibb ( BMY) and Eli Lilly ( LLY) have upsides ranging from -1% to 16%, according to analysts' estimates.

These 10 stocks are listed in terms of buy ratings, great to greatest.

10. United Therapeutics Corporation ( UTHR) is a U.S. - based biotechnology company developing and manufacturing products to treat patients with chronic and life threatening conditions.

Total revenue for the June quarter was $183.8 million, improving from $134.7 million in the year-ago quarter. Net income was $73.9 million compared to $37.7 million a year ago. Gross profit was $162.4 million compared to $119.2 million in the year-ago quarter.

The company has maintained its full-year revenue guidance for its commercial products Remodulin, Tyvaso and Adcirca.

Analysts expect the stock to deliver 34% over the next year and affirm a buy rating of 76%. Recently, Goldman Sachs reiterated a buy on the stock with a target price of $82 per share. The stock is trading at 10.4 times its estimated 2011 earnings.

9. Illumina ( ILMN) develops and manufactures solutions and integrated systems for DNA, RNA and protein analysis.

Revenue during the second quarter of 2011 was $287.5 million, up 36% year over year. Net income during the quarter was $52.5 million compared to $34 million for the second quarter of 2010.

Gross margin during the quarter was 67.3% vs. 68.9% in the same quarter of 2010. Cash flow from operations was $71.2 million compared to $77.2 million for the same quarter a year ago. The company closed the second quarter with $1.2 billion in cash and short-term investments compared to $894.3 million a quarter earlier.

For fiscal 2011, the company guides revenue growth of 24% to 26% with gross margin ranging from 69% to 70%. The company has announced a $100 million share repurchase program after completing its previous buyback in July 2010. The stock is expected to gain 33% over the next one year and has analysts' buy ratings of 78%. The stock is trading at 14 times its estimated 2011 earnings.

8. Sirona Dental Sy ( SIRO) manufactures a complete range of dental products, including CAD/CAM restoration systems, digital intra-oral, panoramic and 3D imaging systems, dental treatment centers and hand-pieces.

Revenue growth in the second quarter was up 12.9% to $214.7 million. Year-over-year revenue growth for imaging systems was 21.4%, 16.1% for CAD/CAM, 3.4% for treatment centers, while it declined 1.3% for instruments. Revenue in the U.S. increased 2.9%, while revenue outside the U.S. improved 17.5% with strong growth in Germany, other European markets and the Asia-Pacific region.

Gross profit was $115.7 million, up $16.4 million from the second quarter of 2010. Gross profit margin was 53.9%, up from 52.2% in the prior year due to lower amortization expenses.

Net income for the second quarter of 2011 was $29.3 million versus $17.5 million in the prior year period. As of March 2011, cash and cash equivalents stood at $300.1 million, while net debt reduced to $82.1 million from $119 million a year earlier. Management has raised FY2011 guidance, estimating revenue to grow 13% to 16% versus 9% to 12% previously. Analysts estimate an upside of 27% in the next one year. The stock has 81% buy ratings and is trading at 15 times its estimated 2011 earnings.

7. UnitedHealth Group ( UNH) is a diversified health and well-being company offering products and services through two platforms: UnitedHealthcare provides health care coverage and benefits, while Optum offers IT-enabled health services.

Revenue for the second quarter of 2011 was $25.2 million, up 8.5% from $23.26 million in the same period prior year. Revenue from UnitedHealthcare increased nearly 8%, while Optrum reported 19% growth during the quarter.

Net margin during the second quarter expanded 20 bps to 5% from 4.8% in the second quarter of 2010. Cash flow from operations grew 65% year over year to $1.2 billion from $723 million in the corresponding quarter of 2010

The company's debt to debt-plus-equity ratio was 29%, about 1% lower than in the previous quarter. Annualized ROE of 19% increased from 18% in the second quarter of 2010.

The stock has delivered 30% since the start of 2011. According to the consensus of 27 analysts polled by Bloomberg that cover the stock, 22 rate it a buy and five a hold. Analysts expect the stock to deliver 30% in the next one year.

6. Pharmasset Inc. ( VRUS) is a clinical-stage pharmaceutical company that develops drugs to treat viral infections.

Revenue for 2011 third quarter was $0.2 million, flat compared to the same quarter in 2010. Net cash used in operating activities was $22.3 million with cash and cash equivalents of $188.2 million.

During the first half of 2011, the company signed a clinical collaboration with Tibotec and was issued a US patent for PSI-7977. Schaefer Price, the company's CEO, said, "The second half of 2011 holds a number of important clinical milestones for us, as we plan to report SVR12 data from both the PROTON and ELECTRON trials. In addition, we plan to initiate the QUANTUM study, our first SVR-focused, interferon free trial with PSI-7977 and PSI-938 in the third quarter."

Of the 20 analysts covering the stock, 17 rate a buy and 2 maintain a hold, as per Bloomberg consensus. Recently, Morgan Stanley raised the stock's price target from $175 to $206 and maintained its overweight rating on it. Analysts expect the stock to deliver 38% return over the next one year.

5. Bio-Rad Laboratories ( BIO) is U.S.-based company engaged in the manufacture and supply of products for the life science research, healthcare, analytical chemistry and other markets. The company operates in two segments: life science and clinical diagnostics.

Revenue for the second quarter of 2011 was $521.7 million, up 11.5% from the comparable quarter 2010. Second-quarter gross margin was 56.2% versus 57.4% reported during the same quarter of the earlier year.

Net income for 2011 second quarter was $40 million versus $38 million in the corresponding quarter of 2010. Earnings per share were $1.41 per share, higher than $1.35 per share reported during the same period last year.

Analysts expect the stock to deliver 33% over the next one year. The stock has 86% buy ratings and is trading at 18 times its estimated 2011 earnings.

4. Mednax Inc. ( MD) provides physician services including neonatal, pediatric subspecialty, maternal-fetal and anesthesia care.

The company reported 12.7% growth in the second quarter to $393.4 million. Operating income improved 13.4%, exceeding revenue growth on successful integration of its newly acquired physician group practices into its established operations infrastructure. Operating margin expanded 15 basis points to 23.7% year over year. Overall, net income grew 13.3% to $55.9 million.

Cash and cash equivalents stood at $24 million and cash flow generated from operations was $95.3 million.

The company guides third-quarter earnings to range from $1.15 to $1.20 per share, assuming that total same-unit revenue will grow 2% to 4% from the prior-year period. The stock is trading at 13 times its estimated 2011 earnings. Analysts expect an upside of 25% over the next one year with buy ratings of 87%.

3. Covidien Plc. ( COV) is a global health care products company operating through three segments: medical devices, pharmaceuticals and medical supplies.

Net revenue during the third quarter of fiscal 2011 was $2.93 billion, increasing 14% from $2.56 billion in the comparable quarter prior year. Foreign exchange gains boosted net revenue during the quarter, while revenue from the medical devices segment improved 22%.

Third-quarter 2011 gross margin rose 1.5% year over year to 57.1% due to an improved business mix, accrued benefits of its restructuring programs and higher foreign exchange gains. Net income increased 14% during the quarter to $535 million.

As regards utilization of cash flows, Jose' E. Almeida, the company's CEO, said, "We also funded incremental investments in our business that were fueled by our strong cash flow and that should drive future growth. In the last 12 months, we have returned over $1 billion in cash to shareholders through dividends and share buybacks, representing more than 50% of our free cash flow. Our overall Company performance remains on plan, and we are confident we will have a strong finish to the fiscal year."

Analysts expect the stock to deliver 28% return in the next one year with a buy rating of 88%. The stock is trading at 12.5 times its 2011 earnings.

2. Thermo Fisher ( TMO) provides analytical instruments, equipment, reagents and consumables, software and services for the research, manufacturing, analysis, discovery and diagnostics markets.

Revenue for the second quarter of 2011 grew 12% to $2.90 billion. Adjusted operating margin increased 40 basis points year over year to 17.6%, while earnings grew 22% during the same period.

Regarding the deployment of capital, Marc N. Casper, CEO of Thermo Fisher Scientific, said in a press statement, "We also continue to effectively deploy our capital to create shareholder value. We've spent $2.1 billion on acquisitions completed so far this year. In addition to creating a leading chromatography portfolio with Dionex, we expanded our range of laboratory consumables with Sterilin, and last week acquired TREK Diagnostic Systems to broaden our microbiology offerings. "Earlier in the quarter, we announced the acquisition of Phadia, which will enhance our specialty diagnostics capabilities with tests for allergies and autoimmune disorders. I'm pleased to report that the acquisition process is moving along faster than we expected and we now anticipate closing the transaction late in the third quarter. Finally, we deployed $225 million of capital during the quarter to buy back our stock."

The company has $1.3 billion in cash, cash equivalents and its operating cash flows stand at $355 million. Of the 17 analysts covering the stock, 16 rate a buy and 1 suggests a hold, as per a Bloomberg consensus. Analysts expect the stock to deliver 34% in the next one year. The stock is trading at 13.5 times its estimated 2011 earnings.

1. HCA Holdings ( HCA) operates hospitals and provides health care and related services through a network of outpatient facilities, clinics and acute care centers.

During the second quarter of 2011, revenue increased to $8.1 billion from $7.8 billion in the same quarter prior year. Patient volume grew 3.7%, supporting top-line.

Net income totaled $229 million versus $293 million in the second quarter of 2010. Lower profit during the quarter is attributed to a pre-tax loss on retirement of $75 million debt.

Cash flow from operations increased 71.6% to $748 million, as of June 2011. HCA operated 164 hospitals and 111 freestanding surgery centers at the end of the quarter. The stock is expected to deliver 48% return in the next one year with 96% analysts rating the stock a buy, according to a Bloomberg consensus. The stock is trading at 9.4 times its estimated 2011 earnings.