Oscar Health: The Future of Healthcare is trading at a bargain
San Jose, California, United States, 17th Oct 2022, In 2008, savvy investors grabbed the deal of a lifetime as stock valuations were slashed. In today’s environment, waves of selloffs have again left some truly quality companies at atrociously low valuations. Oscar Health is one of those companies. Established in 2012, the company aims to tackle the issues made by the intricacies and shortcomings in the current healthcare insurance industry through an easy-to-understand front-end and impressive algorithms in the backend. The company’s mission is to put the customer first, an idea that has been lost in the current market filled with conglomerates.
Que Capital, an equity research firm that focuses on small-cap and ESG stocks, has done in-depth research on the company and a long-time bull. Their thesis is that the company benefits from secular growth and an eventual switch to a SaaS business model. Combined with their loyal customer base, analysts from Que Capital estimate that the stock is undervalued by over 3.5x.
Oscar Health customers download its mobile app, where they have access to a virtual care team that can clearly explain what’s covered under their plan. The app also uses artificial intelligence to identify the cheapest and best place to get their treatment. It is also one of the few insurance companies that provide customers with the cost of their visit. Within the companies that do provide this information, Oscar Health has been shown to have the most accurate prediction. Oscar Health has done a good job combining big data and customer support to provide the most transparent experience to customers. This has paid off, as the company enjoys the highest customer satisfaction rate in the industry.
The company also benefits from changing microeconomic trends. As more Americans become freelance workers and the existing workforce continues to switch jobs constantly, Americans increasingly seeking to buy their insurance from the ACA market instead of relying on insurance from their employers.
Finally, the company is shifting its business model to be SaaS-based. As hospitals are being incentivized to switch to a value-of-care model, Oscar has been able to fill that need by selling its software to help hospitals analyze patient data. The company’s software is truly a gem that even competitors are willing to pay for. To date, the company has made over 3 partnerships with health insurance companies, who lease the rights to use Oscar’s proprietary software to increase customer satisfaction and lower cost for their customers.
After falling over 85% from its peak as a result of the market sentiment against high-growth tech stocks, the stock is trading at a huge discount. It is a good bet to have in your portfolio for the next 10, maybe even 20 years.
Organization: Que Capital
Contact Person: Michael Que
City: San Jose
Country: United States
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