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4 Top Healthcare Stocks for July
I recently revisited four of my favorite healthcare-related stocks in $DOCS, $PGNY, $MEDP, and $INMD and discussed why they all look like interesting buys for the long term.
Here's my investment thesis on each:
- Doximity - An interesting way to play the advertising shift from linear tv to digital platforms, especially as most countries outside the U.S. seem to find our excessive pharmaceutical ads on tv to be quite odd. I can't disagree. Doximity's platform at least allows pharmas and hospital systems to go straight to the physicians to market their products. Considered the "Bloomberg for physicians," DOCS has 80% of U.S. doctors on the platform and already generates 30% free cash flow (FCF) margins even after stock-based compensation is removed.
- Progyny - First-mover advantage in the fertility services niche. With 1 in 6 couples facing infertility across the globe -- a number up from 1 in 8 just four years ago -- Progyny's high growth and market-leading fertility results give it multibagger potential. Its Net Promoter Score of 81 highlights how much its products mean to its customers.
- Medpace - I like to view Medpace as a picks-and-shovels play to the small-cap biopharmaceutical industry. Rather than buying a basket of tiny biotechs, I use MEDP and its suite of solutions (used to navigate the four clinical phases} as though it were an ETF of the biotech industry itself.
- InMode - Plastic surgery seems terrifying to me and laser-based aesthetics solutions seem too short-term to be great solutions, so InMode's radio-frequency energy technologies fill what the company calls the "treatment gap." Still learning a bit about this one as its a little over my head medically, but I love the idea of its razor-and-blade model being built out over the long term. Trading with a forward P/E of only 14, I'm happy to take a small position and keep watching.
Would love to hear your thoughts on these four, or which one is your favorite.
Thanks as always for reading. 🙏
Who is your pick for the next decade?
10%Doximity
40%Progyny
20%Medpace
30%InMode
10 VotesPoll ended on: 7/16/2023
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