In this article, we will take a look at the 5 most promising medical stocks according to analysts. To see more such companies, go directly to 12 Most Promising Medical Stocks According to Analysts.
5. InMode Ltd. (NASDAQ:INMD)
Number of Hedge Fund Holders: 30
One-Year Price Target: $50.40
Israeli medical device company InMode Ltd. (NASDAQ:INMD) ranks 5th in our list of the most promising medical stocks according to analysts. InMode Ltd. (NASDAQ:INMD) was rising in early hours of February 14 after the company posted strong fourth quarter results. InMode Ltd. (NASDAQ:INMD)’s adjusted EPS in the period came in at $0.78, beating estimates by $0.09. Revenue in the quarter jumped about 21% on a YoY basis to total $133.57 million, beating estimates by $3.93 million.
InMode Ltd. (NASDAQ:INMD) also gave full-year 2023 guidance. InMode Ltd. (NASDAQ:INMD) expects revenue in the period to come between $525 million and $530 million while the consensus estimate for this metric is $528.84 million.
4. AMN Healthcare Services, Inc. (NYSE:AMN)
Number of Hedge Fund Holders: 33
One-Year Price Target: $148.00
AMN Healthcare Services, Inc. (NYSE:AMN) is one of the most promising medical stocks according to analysts, as its average price target for one year stands at $148. In November, AMN Healthcare Services, Inc. (NYSE:AMN) posted its third quarter results. Adjusted EPS in the period came in at $2.57, beating estimates by $0.17. Revenue in the period jumped about 30% on a YoY basis to total $1.14 billion, beating estimates by $40 million. For the fourth quarter, AMN Healthcare Services, Inc. (NYSE:AMN) was expecting its revenue to come between $1.050 – $1.080 billion versus the consensus estimate of $1.03 billion.
As of the end of the September quarter of 2022, 33 hedge funds tracked by Insider Monkey reported owning stakes in AMN Healthcare Services, Inc. (NYSE:AMN). This was up from 26 hedge funds that had stakes in AMN Healthcare Services, Inc. (NYSE:AMN) at the end of the second quarter. This shows that hedge fund sentiment is strong for AMN Healthcare Services, Inc. (NYSE:AMN).
Diamond Hill Capital made the following comment about AMN Healthcare Services, Inc. (NYSE:AMN) in its Q3 2022 investor letter:
“New positions initiated in Q3 included Ciena Corporation (long), AMN Healthcare Services, Inc. (NYSE:AMN) (short), CBIZ Inc (short), Asana (short) and Palomar (short). AMN Healthcare Services provides workforce solutions and staffing services at healthcare facilities. An unstable healthcare employment environment is driving pricing and volume growth for contract labor, which we believe is unsustainable.”
3. iRhythm Technologies, Inc. (NASDAQ:IRTC)
Number of Hedge Fund Holders: 33
One-Year Price Target: $145.67
iRhythm Technologies, Inc. (NASDAQ:IRTC) is a heart-monitoring medical solutions company. Wells Fargo recently initiated covering the stock with an Outperform rating. Wells Fargo’s analyst Nathan Treybeck said iRhythm Technologies, Inc. (NASDAQ:IRTC)’s patch monitors Zio XT and Zio AT have good patient compliance and provide important metrics for physicians. The analyst thinks iRhythm Technologies, Inc. (NASDAQ:IRTC) has the potential to double its US penetration in the ambulatory cardiac monitoring market by 2027. He has a $150 price target on iRhythm Technologies, Inc. (NASDAQ:IRTC). The analyst also praised iRhythm Technologies, Inc. (NASDAQ:IRTC)’s AI capabilities.
AI is the talk of the town in 2023 and iRhythm Technologies, Inc. (NASDAQ:IRTC) could leverage its presence in the AI healthcare market and expand into new, innovative areas.
2. ShockWave Medical, Inc. (NASDAQ:SWAV)
Number of Hedge Fund Holders: 34
One-Year Price Target: $243.25
Cardiovascular medical device company ShockWave Medical, Inc. (NASDAQ:SWAV) ranks 2nd in our list of the 12 most promising medical stocks according to analysts. In January, BofA reiterated its Buy rating on ShockWave Medical, Inc. (NASDAQ:SWAV) and said that the selloff after the company’s acquisition of Neovasc (NASDAQ:NVCN) is unfounded. BofA analyst Travis Steed said that he does not see the buyout of Neovasc as a sign of ShockWave Medical, Inc. (NASDAQ:SWAV)’s worries about its core Intravascular Lithotripsy (IVL) growth outlook.
As of the end of the third quarter of 2022, 34 hedge funds among the 920 funds tracked by Insider Monkey reported owning shares of ShockWave Medical, Inc. (NASDAQ:SWAV).
Carillon Eagle Small Cap Growth Fund made the following comment about ShockWave Medical, Inc. (NASDAQ:SWAV) in its Q4 2022 investor letter:
“ShockWave Medical, Inc. (NASDAQ:SWAV) develops products to treat calcified cardiovascular disease. Despite reporting extraordinary revenue growth in the quarter, the magnitude of the increase and the forward guidance given were not enough for elevated expectations, and investors who had made money in the stock through early November decided to take some profits.”
1. Option Care Health, Inc. (NASDAQ:OPCH)
Number of Hedge Fund Holders: 36
One-Year Price Target: $38.17
Illinois-based medical care facilities company Option Care Health, Inc. (NASDAQ:OPCH) provides infusion services. In October, Option Care Health, Inc. (NASDAQ:OPCH) posted its third quarter results. GAAP EPS in the quarter came in at $0.20, meeting estimates. Revenue in the quarter jumped about 14.4% to total $23.72 million. For the full-year 2022, Option Care Health, Inc. (NASDAQ:OPCH) revised its guidance. Option Care Health, Inc. (NASDAQ:OPCH) now expects net revenue for the period to come in between $3.90 billion to $3.95 billion, compared to its prior guidance of $3.85 billion to $3.95 billion. The consensus estimate for this metric is $3.92 billion. Adjusted EBITDA for the period is expected to come between $336 million to $341 million
A total of 36 hedge funds tracked by Insider Monkey reported having stakes in Option Care Health, Inc. (NASDAQ:OPCH) at the end of the third quarter of 2022. The total value of these stakes at the end of the quarter was $627 million.
Baron Funds made the following comment about Option Care Health, Inc. (NASDAQ:OPCH) in its Q4 2022 investor letter:
“We initiated a position in Option Care Health, Inc. (NASDAQ:OPCH), the largest independent player in the $15 billion U.S. home and alternate site infusion market. We believe Option Care is well positioned to capitalize on the ongoing shift to lower-cost sites of care and the proliferation of new specialty drug treatments. Home infusions cost 40% to 70% less than infusions at a hospital. Option Care’s footprint, with over 150 locations, allows it to serve roughly 96% of the U.S. population in a market growing 5% to 7% a year. The company has a well-diversified portfolio of therapies and provider relationships with no customer concentration, enjoys in-network status with all larger payors, and has low direct government reimbursement risk as Medicare currently does not cover home infusion. We estimate the market would double if this were to occur in the future. Given its geographic coverage and therapeutic expertise, the company is assured a seat at the table to discuss new innovative episodic or fully capitated models with payors. It also has strong relationships with relevant drug manufacturers, facilitating early access to newly approved drugs and preferred supply arrangements, while its size and scale provide purchasing power. Management believes the company can continue to generate high single-digit organic revenue growth and mid-teens EBITDA growth. There is also an opportunity to enhance growth through M&A. The company has an excellent track record of acquiring and integrating acquisitions and, with 45% of its market still made up of regional and local providers, there is a meaningful consolidation opportunity.”
You can also take a peek at 10 Hot Tech Stocks To Buy Now and 10 Hot Healthcare Stocks To Buy Now.
