Two names cutting costs and primed for 40-50% gains over the next 6 months.
This week Steve is drilling down into two healthcare names with expectations of 40%-50% gains over the next 4-6 months.
The landscape of political maneuvering, nonstop Executive Orders, Tariffs and DOGE games is making my head spin. Broad indices going up, down, tomorrow or next week? I just don’t know.
Instead I’m focused on the healthcare sector. Not the AI powered biotech/pharma that promises to cure diseases and provide everlasting skinny life; though there is nothing wrong with that.
Instead I’m looking at names that can get into the plumbing, shed some light on the opaque infrastructure and bring down costs and help it run more efficiently. Consider these the low hanging fruit of a bloated system.
Specifically, I have added a new bullish position in Oscar (OSCR) on Wednesday and plan to add Teledoc (TDOC) ahead of its earnings next week. .
These companies can be considered ‘fallen angels’ from the 2021 Covid bubble; pumped with cash, flash and promise only to tumble under the weight of unrealistic expectations.
They were both dubbed healthcare disruptors, which would use technology to help deliver care, treatment and streamline insurance. But simply throwing gobs of money at them couldn’t provide a quick fix to a deeply entrenched and broken industry. In some ways, the influx of cash worked against their mission
Both companies saw values crash some 80% from the 2021 high. OSCR shrank from a $25 billion market down to $3.9bb
TDOC went from a $60 billion market cap down to $2.7bb
Now, time, technology, a valuation reset and veteran management with a renewed focus has them poised to achieve their original missions.
OSCR, is an app based insurance provider that sells directly to individuals and small businesses. It reported earnings last Monday beating on most metrics including 43% revenue growth and adding 1.2 million customers, a 37% year-over year increase, suggesting it is finally taking market share much the increasingly maligned insurance behemoths such as UNH.
Shares surged some 17% following the report.
Option360 initiated a starter position with the purchase of March calls. It should be noted OSCR has 10% of its float sold short, providing kindling for a squeeze. But if if shares retest the $12 level I will add to the position.
TDOC reports earnings on Feb 26 and I’ll likely take a position prior to the release.
Again, over the next few weeks I plan on building a watch list of these names I consider the ‘pick & shovels” of the healthcare industry.
[REPLAY] How Christian is tackling trading this new Administration
Yesterday, Christian Tharp, CMT, went live for an hour to share how he’s trading this new Administration under Trump.
He went through:
- His #1 options trade for the Trump ‘big swings’ we’re already seeing
- What option strategy makes sense
- A trade he’s watching right now as this new Administration makes moves
- How to make 3-5 of these ‘big move’ options trades each month
Get an incredible peek into how Christian approaches the market as an options trader.