Where's My $PGNY Crew At?
Progyny continues to excel with their Q2 earnings.

  • Revenue grew 52% YoY and is up 37% on a TTM basis.
  • Margins are lapping some good Qs but are holding up well. Still a profitable company.
  • FCF has improved with $38MM TTM vs $14MM the previous TTM.
  • Almost no shareholder dilution.
  • Assisted Reproductive Treatment (ART) Cycles broke 10,000 for the first time in a quarter, reaching 10,392 (42% YoY growth).
  • Average member count rose at 4.3MM, growth of 53% YoY.
  • Management raised full year 2022 guidance again to $762.5MM at the midpoint, which would represent revenue growth of 52%, an acceleration compared to 2021's 45% growth.

They came into earnings with a P/S of 4.4 and a P/GP of 24, both near their all-time lows since coming public in late 2019. Those'll rise tomorrow but I'd argue they're still undervalued based on the service they provide and the demand for that service.

Their corporate clients is a who's who. Slide below is from August 2021.
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Steve Matt's avatar
$19.7m follower assets
My May Returns Are In!... And They're Not Great (Still).
As I said in April, my horizon remains 20+ years out. I see my portfolio getting pummeled right now and generally don't care. I only see opportunity.

Retirement Portfolio
In May, I added to $ABNB, $BIPC, $CHWY, $CRM, $CRWD, $DDOG, $GLOB, $JPM, $MMM, $MPW, $O, $OKTA, $PEP, $PGNY, $PLD, $PUBM, $SHW, $SWAV, $TROW, $U, $UPST, and $ZS. I also added to $AAPL, $COST, $JPM, $O, $SBNY, and $SBUX via DRIP. I exited $SMG and $XYL.

May saw my retirement portfolio retreat by 6.86%, bringing my YTD fall to 37.36%, easily getting beat by $SPY, $QQQ, and $VTI.

I'm still learning this new investment software so my all-time performance below is only through the end of 2021.

It's safe to say QQQ is beating me by at least a couple hundred bps through May 31, 2022. I'm certainly still trouncing SPY though.

My Top 10 holdings by current market value make up ~34% of my portfolio.

Taxable Portfolio
My taxable brokerage is ~10% of my total investments. It's also much more speculative (early stage medtech is a big portion). In May, I added to $SILK, $BTC.X, and $ETH.X. Nothing in my taxable brokerage pays a dividend so no DRIP. I didn't exit anything either.

May saw my taxable portfolio retreat by 9.67%, bringing my YTD fall to 42.22%, easily getting beat by $SPY, $QQQ, and $VTI.

My taxable has gone through 3 different iterations over the past 13-ish years. You can see there was no holdings around 2013 and again around 2017 as I sold out of all positions for different life reasons. The beginning to 2013 iteration was the "I don't know what the fuck I'm doing, let me buy random companies I know with no research and pray" phase. Thankfully it was a bull market and I got lucky. The 2014 to 2017 iteration was "I nailed it last time. I'ma do that again but also play with options as well" phase. You can see how well that worked out.

This iteration is actual research with a what-can-this-company-be-in-a-decade being my main thought. This approach is why I don't mind seeing my this portfolio getting whooped. None of the positions in this portfolio are core holdings, which means I follow them quarter-by-quarter via 10-Q/K, press releases, general news, etc. I have my finger on the pulse and the underlying businesses are performing as I hoped or struggling by with bright spots (looking at you $DMTK, $LMND, and $BIGC).

(Note: I didn't lose almost all my money in 2015 but I can't figure out why the software is calculating it that way. 2015 was a bad year in the taxable portfolio but not that bad. Hopefully I have it corrected for my June update).

My Top 10 holdings by current market value make up ~90% of my portfolio.
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A Bunch of Stocks Getting Blown Up
Here are a bunch of stocks getting absolutely blown up over the last couple of weeks/months:

Visit highsandlows.substack.com to see more
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Steve Matt's avatar
$19.7m follower assets
1 of 2
My $PGNY trades
Transaction Journal Entry:
  • Recent quarter beat management guidance and raised FY rev guidance (now guiding for FY 50% rev increase)
  • Q1 is usually biggest jump in fiscal year as new members come on board with medical coverage cycle at companies. Revenue was up 35% sequentially, 41% YoY. Progyny Rx rev up 60% seq. and 84% YoY. Clients up 38%/48%, ART cycles up 36%, average members up 49%/36%. Firing on all cylinders.
  • Something to watch: Margins have been dipping and FCF has decreased a smidge.

Metrics I track on each buy:
P/S - 5.85
Forward P/S - 3.10
PSG - 0.04
P/FCF - 276
Nathan Worden's avatar
$342.6m follower assets
Brad Freeman Pitches Progyny
Progyny does smarter fertility benefits. Brad Freeman gave an extremely impressive rundown of the business in about two minutes.

Want to be impressed? Check this pitch out:

Want to read instead of watch? Transcript is below ‡

Want to meet other smart investors live and year pitches like this one? Register for the next 'Market' stock pitching game: https://lu.ma/jqyctr6r

Brad Freeman's pitch of Progyny

Progyny is a fertility benefits manager and they're really disrupting the space.

What happens in fertility benefits is there's very little legislative mandated coverage in the United States for providing fertility benefits. We use what's called limited lifetime dollar maximums, which places an artificial ceiling on how much an employee is allowed to spend on a given course of treatment.

88% of these treatment processes use limited lifetime dollar maximums. What this leads to is physicians or fertility specialists and patients cutting corners to try and complete a round of treatment within that mandated lifetime dollar maximum, which is roughly $16,000 versus around $60,000 for an average course of treatment.

So you can imagine how this pricing pressure really leads to decisions like no genetic testing or forced intrauterine insemination, or IVFs without any kind of genetic testing to truly know if that's what they should be doing.

For Progyny they've created, what's called a smart bundle, which allows several dozen courses of treatment to be bundled and combined together.

They have a patient care advocate that's assigned to every single patient that contacts with them and they really guide them as a consultant through which course of treatment to select how to adhere to medications, how to store medications.

The quantifiable edge that progeny enjoys:

16% higher pregnancy rate per IVF transfer versus the entire national average,

26% lower miscarriage rate,

25% higher live birth rate.

And they've been in business for six years and we've seen six years of constant expansion of these leads.

Versus competition, there's someone called Carrot Fertility, there's Maven.

There are others trying to do this. Now really what's important to understand is at the very beginning, Progyny signed behemoths like Microsoft and Amazon on as clients and these clients went to bat for Progyny to force the hand of providers to integrate with Progyny, to allow their reimbursements to be paid out on a pretax basis.

Now for Carrot and for Maven, they must pay out these benefits on a post-tax basis, which means that their members must pay income tax.

If we just take that $60,000 per average course of treatment and slap on a 24% income tax. That total savings for this pre-tax edge is $14,000 per course of treatment that's shared between the employer and the employee. But the conclusion is that the efficiencies within this upgrade that they've brought to the market are immense.

It's a 40% compounder should be through 2024, trades at for around a thirties EBITDA multiples. So this is very much a hyper-growth stock and priced so.

They are net income positive. They are free cashflow positive. That EBITDA margin on incremental revenue is pushing 30% versus around 13% for the business book as a whole. So there is more expansion coming and I will stop talking super fast and answer some questions now :)

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Josh Kohn-Lindquist's avatar
$25.7m follower assets
6 New Stocks for my Portfolio on Monday
I plan to start a position in each of the following stocks on Monday: $EXPI, $MED, $INMD, $LOVE, $PGNY, and $XPEL.

I know very little of them so far, but they fascinate me. So, therefore, I will make each a tiny (1/1,000th) position in my holdings to be able to track them and get some skin in the game.

I have been reading 100 Baggers by Christopher Mayer and wanted to apply a few things I am learning from it to real-life -- just on a small scale for now.

Found these with a finviz screener using the following:
  • Market cap under $10B
  • Price over $3
  • 5-year sales growth over 25%
  • QoQ sales growth over 25%
  • Return on Equity over 25%

These purchases will act mainly as a watchlist, but I will add funds and revisit them for more research if any of these double.

What fascinates me about each:
  • eXp offers optionality within the metaverse
  • Medifast has obesity issues providing a tailwind here in the US
  • InMode owns a 46% profit margin
  • Lovesac: the $CROX of furniture?
  • Progyny's fertility-focused offerings seem very niche but invaluable to those who need it
  • XPEL is up 410x in the last decade 🀯

The 3-year sales growth rates (CAGR) on these stocks range from 33% to 96%, while their Return on Equities run from 31% to 91%.

What do you all think of this strategy?
I own shares of $PGNY. Revenue is has decelerated but from absurd levels. Still grew 45% last year. Margins need to improve but already net income and free cash flow positive. Their KPIs are rock solid.
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Steve Matt's avatar
$19.7m follower assets
The Coming Week in Earnings
Woooo boy, this week will be fun for my portfolio.

Monday (5/2)
  • $BIGC^ (On my Sell Watchlist)

Tuesday (5/3)

Wednesday (5/4)

Thursday

Friday

Anything with a ^ indicates I read the 8-K and 10-Q/10-K and track their financials along with KPIs on a spreadsheet I have.

So basically, this will be me next week...
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Nathan Worden's avatar
$342.6m follower assets
'The Market' Stock Pitching Game β€” Friday, March 11th at 12pm EST
"The Market" stock pitching game is a bracket-style elimination tournament for investors.

Audience members get to ask questions of the contestants and vote to decide the best pitch of the night.

Sign up to get the Zoom link for the March 11th game HERE

What is the best investment idea of the month? The Market will decide!

Here's the awesome lineup for the game this Friday:

Ayesha Tariq β€” $DIS @ayeshatariq
Sean Emory β€” $Z @seane
Strat Becker β€” $BBW @strat
Brad Freeman β€” $PGNY @stockmarketnerd
Sohaib Abbas β€” $SPGYF @sohaibab9
Young Money Capital β€” $PRM @youngmoneycapital
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