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A report on U.S. gross domestic product growth Thursday showed surprising and welcome strength for the consumer, but things have changed dramatically since the 1990s – spending on health care, not at the mall, is driving the trend.

A resurgent U.S. consumer pushed American GDP growth to an annualized 3.7 per cent, quarter over quarter, for the three months ended in June, well ahead of consensus estimates of 3.2 per cent.

For Canadians to get the full picture of American consumer health, however, a special focus on health-care spending is required.

The United States is the only developed country that includes health-care spending as a consumer item. Health-care spending is far less discretionary than clothes or cars, and rising medical costs may be more a sign of an aging population than consumer confidence.

Bloomberg data indicate that over the past 12 months, rising health-care spending accounted for 98 per cent of the growth in overall consumption. Investors looking to benefit from the trend should focus not on Wal-Mart and Macy's, but in the medical sectors.

The accompanying chart highlights how much more rapidly health-care consumption is increasing relative to total spending.

For much of the past decade, health-care consumption rose and fell along with aggregate U.S. consumer spending. Over the past 12 months, however, health-care consumption has grown some 5.2 per cent, compared with overall consumer spending of 3.2 per cent – a significant margin given the enormous scale of the U.S. consumer market.

The table (bottom) highlights the 12 U.S. health-care stocks with the highest correlation – closest relationship – with the rapid growth in health-care spending – in the past 10 years. They are ranked by year-to-date performance.

The top performer is Universal Health Services, a hospital company. (Full disclosure: A close family member owns this stock, on my suggestion.) Universal has returned 23.3 per cent so far in 2015 and, perhaps more importantly, has also seen the biggest jump in analyst forward earnings expectations in the past 90 days.

AmerisourceBergen Corp. has generated the next best returns, but has also seen a reduction in forward earnings expectations.

Laboratory Corp. of America Holdings, which provides a network of medical testing facilities, is the most attractively valued stock in terms of trailing 12-month and forward price-to-earnings ratios.

In the event U.S. economic growth accelerates further, more economically cyclical sectors such as home builders, railways and trucking companies will likely outperform health-care stocks. Even so, the predictable increase in demand for medical services resulting from demographics should continue to see the sector generate strong returns.