The discovery of COVID-19 vaccines and drugs, the development of integrated medical diagnostic devices and solutions, virtual consultations, and treatments and therapies for other critical illnesses have all helped the healthcare industry grow in ways significant and attracting the attention of investors. This is demonstrated by the SPDR ETFs of the healthcare sector (XLV) 20.3% returns over the past year.
Additionally, while historically high inflation and continued volatility in the broader market could cause many large cap stocks to depreciate in value, inelastic demand for healthcare products and services is expected to help stocks of many market players. sector to perform regularly.
Against this backdrop, Wall Street analysts are optimistic about the upside potential for low-priced stocks emerging in this space – 22nd Century Group, Inc. (XXII), UpHealth, Inc. (UPH) and Talkspace, Inc. (SPEAK). These stocks are expected to increase by over 35% in the short term.
Click here to view our health sector report for 2021
22nd Century Group, Inc. (XXII)
With a market capitalization of $ 519.17 million, XXII is a Clarence, based in New York biotechnology company that develops plant-based solutions for the life sciences, consumer products and pharmaceutical markets. The company produces tobacco and ultra-low nicotine cigarette (VLNC) products under the names Moonlight and Moonlight Menthol and SPECTRUM research cigarettes in independent clinical studies.
On August 30, 2021, XXII announced its entry into the global specialty hops market, its third and final franchise of factories. The company plans to build a new subsidiary in the Netherlands to open up new revenue opportunities in the specialty hops market and serve its tobacco and hemp / cannabis plant franchises through an expanded global footprint. As a critical input to the $ 500 billion global brewing industry and a growing source of medically important molecules, this entry into the hop market is expected to benefit XXII significantly in the long run.
On July 22, 2021, XXII entered into a new contract manufacturing agreement with a leading tobacco industry partner specializing in the export of cigarettes to foreign countries. The company will invest to optimize its margins, install new equipment at its tobacco manufacturing plant in North Carolina, and expand and establish additional distribution channels to launch its reduced nicotine (RNC) VLN cigarettes. XXII is currently awaiting FDA clearance for the MRTP designation for its VLN cigarettes.
For its fiscal third quarter, ended September 30, 2021, XXII’s revenue increased 6.9% year-over-year to $ 7.81 million. The company’s gross profit was $ 449,000 for the quarter, marking a 24% year-over-year improvement. XXII had Cash and cash equivalents of $ 1.63 million as of September 30, 2021.
Analysts expect XXII’s revenue to improve 20.1 percent year-over-year to $ 33.74 million for the current year. Over the past month, the stock has gained 7.2% in price and closed yesterday’s trading session at $ 3.11. The average price target of $ 7 for the stock indicates a potential increase of 125.1%.
UpHealth, Inc. (UPH)
UPH operates as a digital health services company that offers a patient-centric digital health platform and technology services to manage health and integrate care. The Delray Beach, Florida, The company empowers providers, health systems, health plans and governments, employers and educational institutions. It has a market cap of $ 494.78 million.
On October 26, 2021, UPH and Mazars USA LLP, a global healthcare industry leader providing advice, guidance and solutions, partnered to develop an integrated compliance roadmap for UPH. Mazars will support UPH’s ongoing efforts to lead compliance in operations, governance, security and privacy.
On October 13, 2021, UPH announced the expansion of its NUTRAscriptives Direct product line of clinical-grade supplements distributed online, in retail stores and directly from suppliers. NUTRAscriptives Direct provides an easy-to-support business model for providing patients with high-quality supplements to augment their care plans. The new service further expands UPH’s leadership in health management with personalized protocols.
UPH’s total revenue for the third quarter, ended September 30, 2021, increased 53.9% sequentially to $ 49.07 million. The company’s gross profit was $ 19.78 million for the quarter, up 70.5% from the prior year period. Its net income was $ 32.59 million, compared to a loss of $ 32.78 million in the second quarter. Its EPS was $ 0.28, down from a loss of $ 0.35 per share in the previous quarter. UPH had $ 67.88 million in cash and cash equivalents as of September 30, 2021.
Over the past month, UPH has gained 77.7% and ended yesterday’s trading session at $ 3.43. The average analyst price target of $ 7.50 represents a 118.7% upside potential.
Talkspace, Inc. (SPEAK)
TALK operates as a virtual behavioral health care business. The company offers treatment options for psychiatry or therapy for adolescents, individuals or couples. Members can send text, video and voice messages to their therapists and participate in live video sessions. It has a market cap of $ 325.83 million.
On November 10, 2021, TALK received a $ 3 million grant from the National Institute of Mental Health (NIMH) to study the effectiveness of Cognitive Processing Therapy (CPT), a well-established treatment for post-stress disorder. traumatic (PTSD), in a virtual setting. This study will build on preliminary research from TALK, which found that combining CPT with virtual tools could reduce symptoms of trauma to twice as much as usual treatment in less time. TALK is eager to help find innovative and effective avenues for treating trauma and PTSD.
For its fiscal third quarter, ended September 30, 2021, TALK’s total revenue increased 22.6% year-over-year to $ 26.36 million. The company’s net income was $ 1.51 million, compared to a loss of $ 2.69 million in the prior year period. Its EPS was $ 0.01 for the quarter compared to a loss of $ 0.20 per share in the prior year period. TALK had $ 222.87 million in cash and cash equivalents as of September 30, 2021.
TALK lost 37.3% of its price over the past month and ended yesterday’s trading session at $ 2.29. Analysts expect the stock to hit $ 3.17 in the near term, which is a potential 38.4% Upside down.
Click here to view our health sector report for 2021
XXII shares were trading at $ 2.89 a share on Thursday afternoon, down $ 0.22 (-7.07%). Year-to-date, XXII has gained 31.36%, compared to a 26.85% increase for the benchmark S&P 500 over the same period.
About the Author: Sweta Vijayan
Sweta is an investment analyst and journalist with a particular interest in researching market inefficiencies. She is passionate about educating investors so that they can be successful on the stock market. Following…