In this article, we discuss 5 healthcare stocks to buy according to Tiger Cub Chase Coleman. If you want our detailed analysis of these stocks, go directly to 10 Healthcare Stocks to Buy According to Tiger Cub Chase Coleman.
5. Ginkgo Bioworks Holdings, Inc. (NYSE:DNA)
Tiger Global Management’s Stake Value: $28,106,000
Percentage of Tiger Global Management’s 13F Portfolio: 0.05%
Number of Hedge Fund Holders: 32
Ginkgo Bioworks Holdings, Inc. (NYSE:DNA), a biotech company engaged in genetic engineering to produce bacteria with industrial applications, is one of the best healthcare stocks to buy according to Tiger Cub Chase Coleman. Coleman, via Tiger Global Management, holds a $28.1 million stake in Ginkgo Bioworks Holdings, Inc. (NYSE:DNA), which accounts for 0.05% of the firm’s total Q3 securities.
Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) published on November 15 its Q3 results. The company posted a loss per share of $0.08, missing estimates by $0.05. Revenue for the quarter equaled $77.61 million, exceeding estimates by $31.61 million.
Jefferies analyst Laurence Alexander on November 29 initiated coverage of Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) with a Buy rating and a $16 price target. With $1.7 billion cash on hand, the analyst projects Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) to be able to leverage secular trends in favor of synthetic biology to grow from $221 million in sales in 2021 to $1.1 billion in 2025 and $4.5 billion in 2030. He expects Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) to monetize the value of its programs through a mix of royalties, license payments, and equity share.
In the third quarter database of 867 elite hedge funds maintained by Insider Monkey, 32 funds reported owning stakes in Ginkgo Bioworks Holdings, Inc. (NYSE:DNA), worth $5.69 billion.
4. GoodRx Holdings, Inc. (NASDAQ:GDRX)
Tiger Global Management’s Stake Value: $96,192,000
Percentage of Tiger Global Management’s 13F Portfolio: 0.18%
Number of Hedge Fund Holders: 26
Another top healthcare stock pick of Chase Coleman from Q3 2021 is GoodRx Holdings, Inc. (NASDAQ:GDRX), an American healthcare company that manages a telemedicine platform, in addition to a free website and mobile application that checks prescription drug prices across more than 75,000 pharmacies in the United States.
Chase Coleman owns 2.34 million GoodRx Holdings, Inc. (NASDAQ:GDRX) shares, worth $96.1 million, representing 0.18% of the total Q3 investments at Tiger Global Management.
GoodRx Holdings, Inc. (NASDAQ:GDRX) reported third quarter earnings on November 10. The company posted earnings per share of $0.09, in line with analysts’ consensus estimates. The revenue totaled $195.10 million, up 38.91% year-over-year, exceeding estimates by $551,120.
Jefferies analyst Glen Santangelo initiated coverage of GoodRx Holdings, Inc. (NASDAQ:GDRX) on December 1 with a Buy rating and a $47 price target. According to the analyst, GoodRx Holdings, Inc. (NASDAQ:GDRX) is a “Rule of 70-plus company, which is rare for a company of its size,” and the stock’s valuation is reasonable at current levels.
Silver Lake Partners is the largest GoodRx Holdings, Inc. (NASDAQ:GDRX) stakeholder from the third quarter, with 3.53 million shares worth $144.8 million. Overall, 26 hedge funds monitored by Insider Monkey were bullish on GoodRx Holdings, Inc. (NASDAQ:GDRX), down from 28 funds in the preceding quarter.
Here is what Baron Funds has to say about GoodRx Holdings, Inc. (NASDAQ:GDRX) in its Q3 2021 investor letter:
“We initiated a position in GoodRx Holdings, Inc., a leading consumer focused digital healthcare platform. The company’s core offering is a free App that provides consumers with access to discounts on prescription medications. This increases medication adherence since GoodRx’s discounted prices enable consumers to afford to fill their prescriptions, resulting in better health care outcomes and lower costs to the health care system. GoodRx generates revenue each time the consumer uses the GoodRx discount card for a new or refilled prescription. As GoodRx attracts more consumers to its platform, the company increases its scale, which enables it to negotiate lower prices, which attracts more consumers. GoodRx has a growing subscription business where consumers pay monthly subscription fees to access even lower drug prices. The subscription business increases GoodRx’s revenue visibility and customer lifetime value. GoodRx has a strong brand with exceptionally high Net Promoter Scores among consumers and health care providers. With 20 million monthly visitors, GoodRx has a valuable platform that it is monetizing by adding new products and services. Recent examples include its telehealth offering, pharmaceutical manufacturer solutions business, and proprietary health care content, which should help solidify GoodRx’s positioning as the go-to health care platform for consumers. GoodRx is profitable and growing rapidly with strong margins and cash flows.”
3. Bright Health Group, Inc. (NYSE:BHG)
Tiger Global Management’s Stake Value: $96,678,000
Percentage of Tiger Global Management’s 13F Portfolio: 0.18%
Number of Hedge Fund Holders: 14
Bright Health Group, Inc. (NYSE:BHG), a Minnesota-based health insurance company, makes up 0.18% of Tiger Global Management’s Q3 portfolio, with the firm holding a $96.6 million stake in Bright Health Group, Inc. (NYSE:BHG).
In the third quarter of 2021, 14 hedge funds tracked by Insider Monkey were bullish on Bright Health Group, Inc. (NYSE:BHG), with total stakes valued at $529.3 million. This is compared to 23 funds in the prior quarter, holding stakes worth $1.28 billion in Bright Health Group, Inc. (NYSE:BHG).
On November 11, Bright Health Group, Inc. (NYSE:BHG) announced its Q3 results. The company posted a loss per share of $0.46, missing estimates by $0.32. The $1.08 billion revenue exceeded estimates by $9.25 million.
Morgan Stanley analyst Ricky Goldwasser on December 17 downgraded Bright Health Group, Inc. (NYSE:BHG) to Underweight from Equal Weight with a price target of $4, down from $5. The analyst sees the most difficult road ahead for Bright Health Group, Inc. (NYSE:BHG) in the “healthcare disruptor” IPO class, citing the company’s elevated operating losses and unsteady performance.
Stepstone Group is the biggest Bright Health Group, Inc. (NYSE:BHG) stakeholder from the third quarter, holding 44.65 million shares worth $364.35 million.
Here is what Nomadic Value Partners has to say about Bright Health Group, Inc. (NYSE:BHG) in its Q3 2021 investor letter:
“In the first week of August, we made a farm team investment in Bright Health Group (BHG), a health insurer with a similar payer/provider integration strategy as United Health. On September 30th we upsized our position to a 5% weighting. Our averaged cost basis of $8.16 per share creates the company at a valuation slightly over 1x 2021’s expected sales. This valuation may be appropriate for a low growth, old world health insurer, but it is too low in my view after adjusting for the company’s position in the market, various lines of business, and its expected sales growth over the next few years.
To understand why BHG trades at a low valuation today, let’s look at the history and current state of the core market it competes in…” (Click here to see the full text)
2. Oscar Health, Inc. (NYSE:OSCR)
Tiger Global Management’s Stake Value: $130,678,000
Percentage of Tiger Global Management’s 13F Portfolio: 0.25%
Number of Hedge Fund Holders: 17
Headquartered in New York City, Oscar Health, Inc. (NYSE:OSCR) is a healthcare insurance company that uses technological interfaces focused on healthcare to provide a transparent claims pricing system to patients. Oscar Health, Inc. (NYSE:OSCR) stock represents 0.25% of Tiger Global Management’s 13F portfolio, with the hedge fund owning 7.51 million shares of the company, worth $130.67 million in the third quarter. Coleman’s fund increased its stake in Oscar Health, Inc. (NYSE:OSCR) by 22% in Q3.
As of September 2021, Joshua Kushner’s Thrive Capital is the largest Oscar Health, Inc. (NYSE:OSCR) stakeholder, with 37.6 million shares worth $654.1 million. Overall, 17 hedge funds tracked by Insider Monkey were long Oscar Health, Inc. (NYSE:OSCR), up from 16 funds in the prior quarter.
On November 10, Oscar Health, Inc. (NYSE:OSCR) posted its Q3 results, announcing a loss per share of $1.02, missing estimates by $0.37. Revenue over the period totaled $668.38 million, outperforming estimates by $27.38 million.
Morgan Stanley analyst Ricky Goldwasser on November 12 lowered the price target on Oscar Health, Inc. (NYSE:OSCR) to $22 from $26 and kept an Overweight rating on the shares.
1. 1Life Healthcare, Inc. (NASDAQ:ONEM)
Tiger Global Management’s Stake Value: $217,341,000
Percentage of Tiger Global Management’s 13F Portfolio: 0.41%
Number of Hedge Fund Holders: 34
1Life Healthcare, Inc. (NASDAQ:ONEM), a San Francisco-based company offering in-person and online primary health care clinics, ranks first on our list of the best healthcare stocks to buy according to Tiger Cub Chase Coleman. Tiger Global Management increased its stake in 1Life Healthcare, Inc. (NASDAQ:ONEM) by 41% in Q3, holding a $217.34 million position in the company, which represents 0.41% of the fund’s total investments.
In the third quarter earnings results published on November 3 by 1Life Healthcare, Inc. (NASDAQ:ONEM), the company reported a loss per share of $0.34, missing estimates by $0.06. The revenue jumped 48.85% to $151.33 million, outperforming estimates by $5.61 million.
JPMorgan analyst Lisa Gill on December 21 lowered the price target on 1Life Healthcare, Inc. (NASDAQ:ONEM) to $28 from $41 and kept an Overweight rating on the shares.
A total of 34 hedge funds in the third quarter database of Insider Monkey were long 1Life Healthcare, Inc. (NASDAQ:ONEM), with total stakes amounting to $640.4 million. One of the biggest 1Life Healthcare, Inc. (NASDAQ:ONEM) stakeholders from Q3 is Lee Ainslie’s Maverick Capital, with 3.66 million shares worth $74.1 million.
Here is what Nomadic Value Partners has to say about 1Life Healthcare, Inc. (NASDAQ:ONEM) in its Q2 2021 investor letter:
“On June 7th One Medical (ONEM) announced an acquisition of Iora Health, a Medicare Advantage primary care business (MA PCP), for $2.1 billion of ONEM stock. The price implies a forward EV/sales valuation of 7x, a meaningful discount to comparables, Oak Street Health (OSH, portfolio holding) and Agilon Health (AGL), who had forward EV/sales multiples at time of announcement of 9x and 8.7x, respectively. However, after analyzing the provided information in combination with some additional industry scuttlebutt, I decided to sell our small position in the stock on June 18th. If you regularly read these quarterly letters, you are probably wondering why I would pass on this deal. In short, there are three reasons:First, Iora Health is not as good of a business as the category leader, Oak Street Health (OSH, current portfolio holding), which causes me to wonder if ONEM is buying a turnaround5. Second, the deal comes with significant integration risks, both tech and cultural, and the synergies presented by management are suspect6. Third, and probably the most important, is lost time as ONEM figures out these two issues over the next 2-3 years. Category leaders are focused on patient acquisition since they have already proven attractive unit economics at some initial scale. ONEM turning inward to plug holes instead of going all-in on patient acquisition could significantly stunt the base on which revenues can compound over the next few years.”
You can also take a look at 10 Artificial Intelligence Stocks in Cathie Wood’s Portfolio and Top 10 Stocks to Buy According to Legendary Value Investor Joel Greenblatt.
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