Progyny IPO - PGNY
Well here is a stock that is very unique. Actually, this introduced me to a section of companies that I had no idea even existed. And I also believe this is our first healthcare company IPO that we have looked at. With that being said, let's take a look at Progyny!
So what is a Progyny? I felt this Bloomberg blurb sums it up pretty well, "Progyny, Inc. operates as a fertility benefits management company in the US with its headquarters in New York City. The Company offers patients a benefits solution with education and guidance from a Patient Care Advocate and access to a network of fertility specialists. Progyny also aims to reduce healthcare costs for employers through their operations." So basically it's a benefits for employers to employees that aid in INF and other fertility options. It was started in 2008 when another company developed a way to assess the viability of an egg before it was implanted. Progyny saw a break in the market and went for it!
Progyny is aiming at the benefits market from a different angle. While a majority of healthcare providers offer very little fertility coverage if any at all, Progyny is finding that with a lower tier of treatments, you end up spending more money as an employer. If you have a higher standard which leads to a higher chance of pregnancy you are actually decreasing your costs. Interesting enough. Right now, it is estimated that 1 in 8 couples will struggle with conception. And with that comes stress. Stressed out employees in this situation often have less productivity which leads to less work output. They also believe that as younger and younger generations enter the workforce, with the increased focus on work/life home balance, offering these fertility benefits will keep workers happier, and more willing to come back to work after the baby is born.
I am very interested to see how this one does, as insurance companies always seem to do pretty well. Insurance companies are typically the last to fail when an economic downturn happens. BUT with it being a fertility company, I also seeing it being the first benefit being cut if it did come down to that. How does it compare to others? There seems to be many fertility companies out there. Some are geared at making you healthier or less stressed to help the fertility process, some are tracking fertility apps, and then you have your benefits companies that match you to providers when you still have troubles. From what I can tell however, Progyny seems to have the edge in having more success. According to CNBC:
Progyny clinicians have a 20% higher IVF success rate than the national average.With multiple births, Progyny exceeds the national average by 74 percent.
Allied Market Research projects that fertility will be a $21.6 billion business globally by 2020, so there is certainly opportunity. Progyny helps negotiate with providers for fertility treatments. Which I couldn't find exact financials on their site, according to Craft.com total revenue for H1 2019 was $103 Million. I hope to see some actual reports come out on their site before I form any opinions on what I think it will do.
Interestingly enough, since Progyny's IPO back on October 25, 2019 of $13, it has only gone up. Quite a difference from most IPO's. I still do expect it to make it's pull back at some point as all IPO's eventually do, but for now let's just let it do it's thing. Remember, we don't get in at the top. We wait for it to pull back! Here is my chart and short term trade set up.
That's about it! I hope you found it enjoyable! Until next time, stay awesome!