How RXMD is going to get to $1
This is a 40x improvement over today's ~$0.025 share price
. Do I think it will happen this year? Though some believe it's possible, I wouldn't bet the farm on it. Do I think it's very possible within the next 3-5 years? Absolutely! Here's how and why...
First, Progressive Care, Inc. (RXMD) is clearly undervalued, but the pps is correcting and will be reaching upward for 0.10+ before you know it. Organic growth and a handful of acquisitions - simply executing the strategic plan - will do the rest. I see RXMD as a serious buyout target in 2-3 years!
Large national pharmacy companies are fending off competition from mail-order prescription discounters, online pharmacies, wholesale retailers such as Costco and health clinics, among others:
- Dec 16, 2015 - CVS Health Corporation (NYSE:CVS) and Target Corporation (NYSE:TGT) announced today that CVS Health has completed the acquisition of Target's pharmacy and clinic businesses for approximately $1.9 billion.
- Oct 28, 2015 - Walgreens said on Tuesday that it will buy rival Rite Aid in a $17.2 billion deal that would whittle the nation's one-time mom-and-pop drug-store industry into two massive chains. Walgreens Boots Alliance, which operates the namesake drug store chain, said it is paying $9 per share in cash in a valuation that includes the assumption of debt. That reflects a 48% premium above Rite Aid's value at the close of trading Monday.
- Aug 19, 2015 - CVS Health Corp. (CVS - Analyst Report) has completed the acquisition of Ohio-based pharmacy services provider, Omnicare, for $12.7 billion, including a debt of $2.3 billion, well ahead of time. The buyout reflects the company’s foray into a new pharmacy distribution channel – the long-term specialty care market.
- From a 2010 article:
Omnicare has a rich history of growth through acquisitions, which has made it a dominant player in the industry. The company boasts a reasonably sound balance sheet and is well positioned with healthy cash flow, which it can use for further acquisitions, debt repayments and share repurchases. Omnicare is pursuing an aggressive acquisition strategy in fiscal 2010. The company agreed to buy institutional pharmacy businesses in July 2010 and is also in advanced negotiations for other acquisitions.
While the goliaths have been hammering away at acquisitions and consolidation in the broader pharmacy retail sales and services markets to maximize commodity-type margins, Progressive Care, Inc. (RXMD) has been quietly whittling away at a health services business model that focuses on a small but substantial piece of the very large pie. This piece of pie, however, concentrates on high-margin revenue derived from medications and services for an underserved segment of the market. Progressive Care specializes in the care and management of patients with special needs, long-term care needs, and including medications for infectious diseases.
As stated in the Open Letter to Shareholders, Progressive Care will continue to strengthen the successful PharmCo model by "adding business elements that cater to specific under-served markets and demographics." In doing so, Progressive Care raises the bar, creating a steeper barrier to entry for regional competition in existing markets. For example, Progressive Care will add a "closed-door pharmacy facility" to the existing PharmCo operation this year. It seems likely that this will be a nearby (near the existing PharmCo site) satellite pharmacy operation embedded in a long-term care or other health services facility in one of the underserved markets/demographics of focus.
As also stated in the Open Letter to Shareholders, Progressive Care "will also look for opportunities to expand the pharmacy through establishing new locations or through mergers/acquisitions with similarly positioned independent pharmacies," and "will seek licensures in additional states in order to begin positioning PharmCo as a national brand."
Progressive Care, Inc. (RXMD) has it in the game plan to grow revenue organically and to expand into other markets nationally through acquisitions.
The goliaths have it in their game plan to continue increasing shareholder value - indefinitely. As the pending market consolidation in the major pharmacy store and services sector is nearing completion, these companies will look to the next opportunities, especially those that offer higher gross margins. They will not be able to do this organically through existing infrastructure, as the services are much more specialized than what a discount pharmacy operation can profitably support. That is, it's simply not a good product mix. The only way they will be able to continue improving shareholder value at their historic rates is through acquisitions.
If you're trading on the OTCBB and you're new to RXMD, it would be a very smart move IMO to diversify your "investments" and take 10-20% of your funds and get a starting position in this stock for the long-haul growth toward this 40-50-60x gain opportunity over 3-5-7 years. Add when you can on any dips and stay long, and use other funds for flipping other penny stocks if that's something that appeals to you. Wanna retire young? This is a road map that's easy to read.