Oscar Health is having its best week since May, up nearly 20% as the stock climbs past an early entry. The health insurance provider is today's pick for IBD 50 Growth Stocks to Watch.
The stock broke out of a cup-without-handle base on May 6, the day before it beat first-quarter expectations and posted its first quarterly profit ever. It was a landmark moment for Oscar Health, whose shares ended up rising 20% that week.
Today, the stock has echoed the May rally with a different type of breakout. Shares jumped more than 18% Wednesday as the stock climbed above a trendline that touched the highs from the May 22 peak. That gave the stock a buy point around 18.50.
The stock Thursday afternoon was about 10% above the entry, so investors may want to wait to see if shares pull back. This is a buy point at a lower price than normal because Oscar Health is also forming a cup base with a 23.44 buy point, about 13% above current quotes.
Oscar Health Extends Profits
In August, the insurer reported another profitable quarter and again beat analysts' estimates.
Management raised its full-year revenue and EBITDA guidance. But it also raised its 2024 medical loss ratio forecast to 80.5%-81.5%. The ratio — which was 79% in the second quarter — is the share of total health care premiums spent on medical claims and improving the quality of care.
Because the company is just now turning profitable, the EPS Rating is 81. But sales growth of 44% to 47% over the past four quarters is a main reason the company has made it to the IBD 50. The three-year sales growth rate is an impressive 80%.
Oscar is the leader in the accident and health insurance industry group, with a 98 Composite Rating.
