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A Potential Small-Cap Rising Star in the Telehealth and Long-term Care Markets (TDOC, RXMD, BKD, ENSG, NHC, GNW, SNDA, CVS)

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A Potential Small-Cap Rising Star in the Telehealth and Long-term Care Markets (TDOC, RXMD, BKD, ENSG, NHC, GNW, SNDA, CVS)

May 06
03:04 2022

There are two major themes that could define the healthcare industry over the coming decade: Telehealth and Remote Patient Monitoring, or RPM/RTM. And they both coalesce around the long-term care and assisted living markets.

The baby boomers were the biggest generation in world history until the millennials came along (1). Now, they are transitioning into long-term care facilities at a record pace (2). That’s an enormous tailwind for stocks with exposure to the space.

But other plays on this theme will also benefit, and many have been crushed in the market’s recent volatility because they are long-term growth plays, which generally suffer when interest rates rise rapidly because money gravitates away from long duration strategies as the cost of capital and risk-free rate of return move higher (3).

However, that could create a powerful opportunity around the next corner in volatile stocks like Teladoc Health Inc. (NYSE:TDOC), a leading telehealth name that has crashed over recent months and is now down 90% since early last year (4).

It’s also boon for long-term care and pharmacy names, including Brookdale Senior Living Inc. (NYSE:BKD), Ensign Group Inc. (Nasdaq:ENSG), National Healthcare Corp. (NYSE American:NHC), Genworth Financial Inc. (NYSE:GNW), Sonida Senior Living Corp. (NYSE:SNDA), and CVS Health Corp. (NYSE:CVS).

But there’s one smaller-cap name that has recently made a very good argument for its own central position in this field: Progressive Care Inc. (OTC US:RXMD).

RXMD bills itself as a Florida health services organization and provider of prescription pharmaceuticals, compounded medications, provider of tele-pharmacy services, the sale of anti-retroviral medications, medication therapy management (MTM), the supply of prescription medications to long-term care facilities, and health practice risk management.

But it has started to move into the telehealth space over the past year and has now expanded decisively into the RPM/RTM space with its recent announcement to that effect (5).

According to new research from MarketsandMarkets, the global RPM market is projected to reach $175.2 billion by 2027, growing at a robust 27% compound annual growth rate over the next 5 years (6).

According to the company’s release, the implementation of patient-oriented technologies such as wearables and 5 G-powered home devices to track physiological data will enhance Progressive Care’s capabilities to provide doctors with usable insights into patients’ overall health. Additionally, it will benefit our existing physician base as well as provide a more complete suite of services for future accounts. CMS authorizes pharmacies to work in collaboration with providers, offering services as employees or contracted personnel and thereby enabling the Company to bill providers and healthcare organizations for RPM services.

Alan Jay Weisberg, CEO of Progressive Care, stated, “The RPM space is set to be one of the most important growth areas within the healthcare industry over coming years and our most logical next step given our broad base of patients who have multiple chronic conditions. Progressive Care has differentiated itself from competitors in terms of commitment to medication therapy management. Our reputation among healthcare professionals in this domain is one of our strongest advantages.”

That announcement was bolstered further this week as the company confirmed its move into the long-term care market with its fresh announcement that its long term care division gained all the necessary long-term care contracts with major payors (7).

“Our long history of enhanced patient care, as well as robust data management platform and logistics network are key elements that will facilitate the success of our long-term care business. The long-term care pharmacy contracts provide Progressive Care with an opportunity to significantly increase its sales that produce much better margins. Our Chief Operating Officer, Birute Norkute, has successfully executed on completing this complicated and tidies process and instituting final and imperative steps for the successful launch of our LTC marketing program. We are excited about LTC business and confident in our ability to deliver strong results.” stated Weisberg.

Progressive Care Inc. (OTC US:RXMD) shares are actually up about 30% so far in 2022 (8), a year defined by massive bear markets in most speculative names. That outperformance has likely been driven by the company’s strong performance in its core pharmacy business (9) as well as its progress toward expanding into Telehealth and the RPM/RTM marketplaces, and to use its established market positioning to leverage that expansion as a strong path into the huge long-term care marketplace.

References:

1. https://www.statista.com/statistics/797321/us-population-by-generation/#:~:text=Millennials%20were%20the%20largest%20generation,the%20population%20for%20many%20years.

2. https://www.cnbc.com/2021/11/08/aging-baby-boomers-raise-the-risk-of-a-long-term-care-crisis-in-the-us.html

3. https://www.wsfsbank.com/help-guidance/knowledge-center/long-growth-stocks-equals-increased-interest-rate-risk

4. https://www.fiercehealthcare.com/health-tech/teladoc-shares-tumbled-after-dismal-q1-earnings-analysts-question-telehealth-giants#:~:text=Teladoc’s%20stock%20is%20down%20more,according%20to%20data%20from%20Refinitiv.

5. https://www.otcmarkets.com/stock/RXMD/news/Progressive-Care-to-Expand-Into-Rapidly-Growing-Remote-Patient-Monitoring-Market?id=354056

6. https://www.marketsandmarkets.com/PressReleases/remote-patient-monitoring.asp

7. https://www.otcmarkets.com/stock/RXMD/news/Progressive-Care-Gains-Long-Term-Care-Contracts-with-Major-Payors?id=355411

8. https://finance.yahoo.com/quote/RXMD?p=RXMD&.tsrc=fin-srch

9. https://www.otcmarkets.com/stock/RXMD/news/Progressive-Care-Reports-Full-Year-2021-Financial-Results-Highlighted-by-389-Million-in-Revenue?id=349785

 

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