HLTH
I bought some HLTH yesterday in the 1.85-1.90 range. Here is what I like.
1) Based on guidance I expect q4 to be huge and be around .30 I believe that will not only make the stock cheap overall, but makes it a good seasonal play.
2) I expect earnings to grow in FY 17, hence say .35 in FY 17, pop a 10 PE on it, and we are trading in the mid 3’s and we are buying here at the lows, as one knows I love to buy on weakness.
3) Although short-term the stock got hit by pulling it dual listing in Canada, it makes sense to pull it since their operations are basically in America, and it was probably costly, hence not worth having a dual listing. Yet providing weakness, to give those interested a good entry point in my opinion.
Conclusion: I will continue to buy on weakness, and given the time of year it definitely possible we get more weakness, but I think it is a good seasonal trade and rather cheaper longer run as an investment, right now only a 2% position, it does have risks if they don’t hit guidance primarily. But I think the risk/reward is in your favor in HLTH. All is just my opinion, and I could always be wrong though.
