- Nutex Health (NUTX) recently finalized a potentially game-changing merger.
- At the same time, Nutex shares are super-cheap based on a commonly used valuation metric.
- Investors should consider a small, speculative position in Nutex Health.
Nutex Health (NASDAQ:NUTX) bills itself as a technology-enabled health management company, and as the future of healthcare. It’s an ambitious claim, but NUTX stock has upside potential as Nutex Health is poised to be a leader in an important niche healthcare market.
As a service provider in the emergency care industry Nutex Health combines the best of human expertise and cutting-edge technology. It’s truly a healthcare business for the 2020s, and Nutex’s business model is both specialized and diversified.
At the same time, it’s a company in transition as Nutex Health just completed a significant business transaction. Meanwhile, as we’ll discover in a moment, NUTX stock looks super-cheap even after a huge recent share-price surge.
In other words, this stock can offer its investors fast movement but also good value. With all of that in mind, let’s take a closer look at Nutex Health and the merger that’s making waves in modern healthcare.
What’s Happening With NUTX Stock?
First things first: NUTX stock is capable of swift price moves. For instance, InvestorPlace contributor Chris MacDonald recently reported that the stock had spiked 140% in a single trading session. Amazingly, this occurred despite the apparent lack of any specific catalyst.
Don’t get the wrong impression — this isn’t how the Nutex share price moves every day. Suffice it to say, though, that the stock can be volatile, so it’s wise to maintain a moderate position size if you choose to make an investment.
Now, here’s something that should pique the interest of value seekers. Believe it or not, Nutex Health’s trailing 12-month price-to-earnings ratio is just 2.09x. That’s a rock-bottom valuation, according to this commonly cited metric.
It’s interesting that NUTX stock is so cheap, since the company offers highly valuable services. Let’s break down the company’s business model, and see if you agree that Nutex deserves a higher re-rating on Wall Street.
First, Nutex Health’s Hospital Division “implements and operates innovative health care models.” These include micro-hospitals, specialty hospitals and hospital outpatient departments. The Hospital Division owns and operates 21 facilities in eight states.
Then there’s the Population Health Management Division, which owns and operates provider networks. The tech angle of this division is the cloud-based proprietary technology platform, which “aggregates data across multiple information systems, settings, and sources to create a holistic view of each patient and provider.”
The Big Merger
In case Nutex Health’s market footprint wasn’t already impressive, a major merger will only add to Nutex’s value proposition.
Not long ago, Nutex Health completed its merger with Clinigence Holdings, a “technology-enabled, risk-bearing population health management company” focused on primary care. The newly combined business is simply called Nutex Health, and the ticker was changed from CLNH to NUTX.
Finalizing the merger with Clinigence Holdings will enable Nutex to create “one of the leading integrated care delivery models in the nation,” according to Nutex Health Chairman and CEO Tom Vo.
On the financial side of things, it’s worth noting that Clinigence Holdings has definitely been in growth mode. In particular, Clinigence increased its total sales from $1.5 million in 2020 to $18.8 million in 2021. Furthermore, the company grew its gross profit from $676,172 in 2020 to $4.1 million in 2021.
All in all, the business combination gives investors not only a new stock to trade on the Nasdaq exchange, but a powerful force in tech-enhanced healthcare delivery. Thus, Vo anticipates “highly attractive growth opportunities ahead” for this expanded business — and so should the shareholders.
What You Can Do Now
So, now you know about an important merger in healthcare, and a new stock to trade on the Nasdaq exchange. Knowing the price-to-earnings ratio of NUTX stock, this looks like a bargain that’s hard to resist.
Just be sure to remember that the stock might be volatile, so small position sizes are a must. That being said, feel free to consider Nutex Health shares as a value investment in a growing healthcare business.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
