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Hedgeye Health Care Live Q&A | Flu Season Ramping, TDOC, and Wage Growth Monday, December 16, 2019 @ 10 AM ET Health Care Public: CLICK HERE for event details (includes video link, materials link and dial-in). |
Mednax (MD) | Mednax began screening as a Stock Quad 1, or an estimate trend that is re-accelerating at an accelerating rate, in recent months. Underlying same unit volume trend may be more robust than the reported number. Mednax has typically included physicians added to a same unit practice as same unit growth. Adjusting prior same unit volume for same practice doc adds, growth has been accelerating consistently for several quarters.
We are considering MD a high priority long based on themes such as new management, a robust US Medical Economy, and activist investor involvement combined with accelerating growth. Please look for updates on the data and team commentary on this name in the coming weeks.
Flu Hospitalizations | Hospital admissions are driven by emergency room visits. Emergency room visits are often driven by flu. A strong flu season leads to strong ER and admissions volume. Flu impacts the US Medical Economy in a number of ways including ambulatory visits, hospitalizations, surgical delays, staffing problems and cost, and medical cost ratios. In the next 2 quarters discerning between tailwinds from flu and headwinds from ESI and slowing employment will be a key to timing.
Comparisons ease over the coming weeks and the tailwinds to ambulatory, outpatient, and hospitalizations will be substantially positive through 4Q19 results and 1Q20 guidance.
Teladoc Health Inc (TDOC) | We put TDOC on the long bench prior to 3Q19 earnings. The UNH and CVS partnerships seem like the likely tailwind behind TDOC’s download outperformance compared to its peers. With flu as an added tailwind, it may be worth moving the ticker off the Position Monitor Bench and returning it to an active long.
Thomas Tobin
Managing Director
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Emily Evans
Managing Director – Health Policy
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