Conor's avatar
$24.8m follower assets
My Worst Investment Ever $CANO Health
Cano Health is a (value-based care) VBC organization with over 150 medical centers and 300,000 members. Medicare revamped its fee schedules from the traditional fee-for-service to value-based care in order to reward providers for managing members' health. For example, the fewer sick people who go to the hospital, the more Medicare will reimburse providers.

Currently, Cano Health is by far the worst investment I have ever made. I started buying shares around the $3-4 range back in 2022. Then there was speculation of a potential buyout from CVS. CVS ended up not acquiring Cano but to make matters worst they acquired Cano's competitor Oak Street Health $OSH for over $8.5B.

I am down 66% on paper but my loss is much worse than this appears. The reason is for my genius idea to buy options in Cano that expired worthless.


If you are going to dip your toes into the M&A game, I would say options are not the best idea. If I did the same trade without any options, I wouldn't be nearly as upset about it. Cano could have been acquired by CVS like Oak Street Health was, and I would be doing a victory lap right now. That makes this trade sting a little bit more as well.

I don't have a fantastic track record with options in general.
Conor Mac's avatar
Thanks for the candour. Was the potential for acquisition a large part of your buying it originally? Or was it more so a "gravy" option.
Conor's avatar
@investmenttalk That's the funny part. I had no idea. I was actually up quite a lot and got carried away when the buyout news happened.
Conor Mac's avatar
@conorvalue Last question, where do you think you went wrong? Initial purchase valuation? something else?

And why do you still own this security?
Todor Kostov's avatar
@conorvalue Thanks for the update, Conor. Short and self-explanatory. How often do you utilise derivatives? Is this part of the investment approach or just on a tactical basis when certain opportunity arises?
Conor's avatar
@kostofff I wouldn't say I utilise them often, but I know enough to be dangerous.
Todor Kostov's avatar
@conorvalue Okay. Makes sense.
Dissecting the Markets's avatar
I remember the firm once being a meme stock. People would talk about it frequently on StockTwits, WSB, etc. Thanks for telling your story to the community.
Conor's avatar
@dissectmarkets I don't remember that. If that were the case I would have stayed away. Yikes. Also, SPAC stocks...
StockOpine's avatar
Thank you for sharing Conor. It seems that your mistake was too much hope on the M&A potential and the options you used to "take advantage" of this potential acquisition, right? Was that the thesis when you initiated the position?
Conor's avatar
@stockopine my thesis was their ability to grow centers across the country which seems to be busted at this point.
Maverick Equity Research's avatar
interesting ... great reflections, thanks!



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