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Righty, so as promised a little recap since I've been gone for a while. I haven't done much shopping in the past 6 months to be honest, it's been mostly about consolidating/simplifying my portfolio a bit by building up cash and selling some companies that were either overvalued or ones that I simply didn't think fit my investment thesis anymore.
The little shopping that I have done in the past months has been:
-small purchases here and there in the following: MSFT/BAM/LMT. All of these will be absolutely awesome for the long-term, and I feel like BAM is even nicely valued here both from a share price and dividend perspective. (3.6% yield and I'm expecting around 15% yearly increases if we don't hit a recession)
-speculative position in ASPI. Very risky, but production does seem to be ramping up nicely and revenue should start to flow in a meaningful way during 2025. This is one of those that will either be a great long-term success story or go to zero in the next 3 years.
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Ray, what's the story with OSCR? I noticed a very high P/E and no dividend. I didn't dig into their financials so don't know much. High growth? Possible acquisition target?
Curious minds want to know.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
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@DW
Oscar Health ($OSCR):
OSCR is a prime example of a high-growth, early-stage company that combines enormous potential with high volatility.
Those who can tolerate strong price fluctuations will find a rare combination of technological innovation, a solid balance sheet profile, and attractive undervaluation.
Technological advantage:
Oscar Health is revolutionizing health insurance through AI integration, digital automation, and data-driven risk selection. The company relies on a user-friendly platform, telemedicine, and real-time services, which significantly increase efficiency and customer satisfaction.
Dynamic growth:
Analysts expect earnings growth of around 53% per year and revenue growth of 8% annually. Return on equity is expected to rise to nearly 18% in three years – values that are rare in the insurance industry.
Profitability and Balance Sheet:
Oscar Health is profitable, boasting a solid gross margin of over 20% and a low leverage ratio (22%). Interest coverage is comfortable, and with nearly $3 billion in cash, financial flexibility is high.
Undervaluation:
The intrinsic value of the share is estimated at just under $29 – corresponding to an undervaluation of around 45% compared to the current price. Discounted cash flow models and relative valuations also show significant upside potential.
Experienced Management:
Mark Bertolini (formerly of Aetna) is an experienced CEO at the helm who is consistently driving the transformation process forward.
Innovation Pipeline:
Expansion into new markets, product innovations, and a focus on ICHRA models and digital platforms strengthen long-term competitiveness.
Risks and Volatility:
The stock is extremely volatile – price fluctuations of 20–30% within a few weeks are possible.
There have been significant insider selling recently, signaling uncertainty.
Regulatory risks and intense competition in the ACA market remain challenges.
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Oscar Health partners with several organizations to enhance its health insurance offerings. These include HCA Healthcare for Texas markets, Cigna for small business plans (Cigna + Oscar), Ciox Health for digital solutions, Optum Behavioral Health for behavioral health coverage, Stride Health for enrollment, and Humana to expand Oscar for Business. They also have partnerships with health systems like Mount Sinai, Northwell, and Montefiore.
Here's a more detailed breakdown:
HCA Healthcare:
Oscar has partnered with HCA Healthcare to offer Individual and Family health insurance plans in Texas markets (Austin, Dallas-Fort Worth, El Paso, Houston, and San Antonio).
Cigna:
Oscar has a strategic partnership with Cigna to offer Cigna + Oscar health insurance plans for small businesses in select markets.
Ciox Health:
Oscar has an expanded agreement with Ciox Health, a Datavant company, for digital services related to clinical data exchange.
Optum Behavioral Health:
Oscar partners with Optum Behavioral Health to provide behavioral health coverage and support to members.
Stride Health:
Oscar has partnered with Stride Health to enhance the enrollment experience for members and brokers.
Humana:
Oscar has partnered with Humana to expand Oscar for Business to Nashville, according to the Oscar Health website,.
Health Systems:
Oscar also partners with leading health systems like Mount Sinai, Northwell, and Montefiore to offer care within their Circle Plus network for businesses.
Emory Healthcare:
Oscar partnered with Emory Healthcare to offer affordable health insurance, care, and innovation in Georgia.
Cleveland Clinic:
Oscar has a partnership with the Cleveland Clinic to improve member engagement and care management, according to Healthscape.
Uno Health:
Oscar has partnered with Uno Health to provide financial support and resources to Medicare Advantage members.
AXA International Employee Benefits:
Oscar has partnered with AXA IEB for international employee benefits and a reinsurance agreement.
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I usually don't invest in small(er) companies but I made an exception with this one. It's been trading in a range, so it's possible to build a solid position and harvest gains along the way. I plan to get to an "x" amount of shares and trim accordingly but will maintain a certain balance of shares. I invest for the Long term.
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Thanks, Ray!
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
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B: OSCR
basically building a position
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B: OSCR
I'll stop posting about this one--still building a position and will continue until i'm done
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Sold out of my positions in CMCSA and QCOM.
Added to my position in Amphenol (APH) and started new positions in Oneok (OKE) and Vertiv (VRT).
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Eric, nice to see you back!
I understand the CMCSA trade, I dumped it from my HSA a while ago when I didn't see much changing in the business. Curious why you dumped QCOM.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
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(Yesterday, 09:51 AM)Dividend Watcher Wrote: Eric, nice to see you back!
I understand the CMCSA trade, I dumped it from my HSA a while ago when I didn't see much changing in the business. Curious why you dumped QCOM.
Just got tired of the inconsistent growth and lack of growth with QCOM. I've owned it twice now and have been disappointed both times. It's projected for just 2% EPS growth in 2026 and 2027 and 7% in 2028. It won't surpass 2022 earnings until 2028.
I'm trying to get a bit more growth in the portfolio, so I put some proceeds into OKE to replace the income and went with the rest into APH and VRT for the growth, as they are expected to grow EPS at 15-25% on strength in sales for AI.
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Fair enough. I believe QCOM is slowly shifting their focus to more than phones. I'm willing to hold it for now. Our cost basis is so low that we can hold for now.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
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