Right now, the market is furiously trying to price in a Blue Wave, and the health care sector is getting clobbered. But here's how I think things play out.
Let's check the charts of the health plan provider.
We are back to square one except for one positive and one negative.
The stock is simply too cheap, given its strong results to begin 2020, and a highly profitable business model that generates huge amounts of cash flow.
Diagnostics revenue grew an impressive 38% due to the necessity of Covid-19 testing.
Canaccord Genuity analyst Sumant Kulkarni gives the biotech company an $80 price target.
Let's talk about what's happening right now to get this thing under control and what it will look like not that long from now.
The decline of the healthcare firm's stock offers the opportunity to sell out-of-the-money puts for an attractive premium.
The company is set to report earnings on Thursday.
It's not the merits of the deal from a long-term perspective I want to trade. It's the beat down of the stock from above $13 to under $11.