저자: Daniel · 외국인
요약 보기
마이클 버리가 MOH(몰리나 헬스케어)를 약 2,500만 달러 매입했다는 사실을 짚고, 최근 실적 악화(순이익 3.5억→1억 미만, 주가 연초 대비 50%↓)에도 불구하고 주정부 계약 수주, 공격적 자사주 매입(발행주식 약 10% 감소), 임원 매수(COO 150만 달러)를 근거로 저평가라고 주장. 2026~2030년 EPS 25~30달러 가능성과 10배 멀티플을 가정해 주가 100%+ 상승 여력을 제시.
다듬은 글
Investors are always on the lookout for the next big short, the next big catastrophe where market prices potentially collapse. And so this is why when Michael Bur disclosed that he had bought probably around $10 million worth of options that gave exposure to around a billion dollars against Palunteer stock.
It got a lot of interest. However, I think a lot of folks miss the fact that yeah, he was buying these Palunteer puts, but he was also buying Molina Healthcare stock. MOH is the ticker. He literally tweeted about it recently saying buy long Mo stock and long PLTR puts is like peanut butter and bananas.
I think he's trying to say they go well together, I suppose. Now, a lot of folks might think, "Oh, Michael Bur's this sort of, you know, onetrick wonder. He he's called he's had these macro calls that are outrageous. He he previously tweeted sell and then he deleted it and like he seems like an odd cat.
He seems like he's angry." I think it's important to reflect on the fact that he is by far one of, in my opinion, the best individual company analysts out there. And so, you you might not agree with me. Let me share an example. So, back in April of 1999, he actually had this post where he's like, "Yeah, I recently bought Apple stock," calling out why he thought it was a Buffett-like stock years before Warren Buffett got interested.
And by the way, since then, Apple stock has gone up well over 70,000%. So, Michael Bur has a nose for finding value in my opinion. So seeing this purchase by Michael Bur of Molina Healthcare, I felt warranted a little bit more review because this was around a $25 million purchase. The exposure, the actual dollar bet might actually be more than his Palanteer bet because when you use options, you could put down 10 million and get a billion dollars of exposure.
I I'm not sure exactly, you know, how much his his Palunteer dollar exposure is, but I I think this is interesting. He's he's saying, yeah, long Molina Healthcare and that, you know, he thinks this is a value play and he has a track record of finding sniffing out value. He's not alone in this situation because the chief operating officer of Molina Healthcare also bought 10,000 shares within the last few months at higher prices.
So, $1.5 million insider purchase. This is interesting to see. And then, so what what are they looking at? They're looking at a stock that has lost a lot of value. Has lost 50% drop this past year. So, you're getting a little bit of bargain hunting from Michael Bur. That's to be expected, but also from the insiders here.
So, let's take a step back to understand what does Molina do? Uh, you know, sort of a framework to how to think about the stock in the years ahead. What does Michael Bury potentially see in Melina Healthcare stock? Mo once again is the ticker. If you enjoy educational investment content, I do appreciate you hitting that thumbs up, hit that subscribe button.
Let's dive into understanding, you know, what what they do. My name is Daniel. You're watching Unrivaled Investing. And so, when you look at Melina Healthcare, they call out they're a Fortune 500 company providing managed healthcare services under the Medicaid and Medicare programs through state insurance marketplaces.
So, what this means is they're contracting with states to offer the health insurance for the poor and the elderly. And you could see the memberships and the number of people um currently around 5.5 million members that they're covering. And the vast majority is Medicaid. So, you're talking about the poor.
And then you also have Medicare, the elderly, vast majority of the users, vast majority of their members, 90% Medicaid. And you can see a similar amount is revenue tied to the contracts where the marketplace only around 7% around 80% of their revenue is Medicaid. How to understand this business and you can see very high level how it's performed over time.
The premiums they've collected by contracting with states. This is how much we're going to charge per member for let's say a Medicaid program or Medicare. It's gone up from around 20 billion to around $40 billion in 2024 and it's expected to be even higher. Now, when you look at their adjusted earnings per share, it's gone from around $10 to around 23.
I personally approve of these adjustments because the adjustments are largely non-cash expenses and not I I I don't believe stockbased compensation. So, this is actually a a very reasonable adjustment. this, you know, this calculation. And so you see strong revenue growth, strong earnings growth, and yet more recently looking at their third quarter results for 2025, yes, continuing to post revenue growth, but the problem is that their profitability has collapsed.
And you can see net income has gone from 350 million last year to under 100 million. So this is the reason why the stock is down over 50%. Year-to- date. Why is it dropping? The heart of the matter is the fact that the costs, the expenses of running a health insurance, health services business has gone dramatically higher.
And they called out how the medical cost trend was higher than expected and driven by utilization of behavioral health, pharmacy, impatient care, largely consistent with what we've observed throughout the year. So they're they're talking about the fact that people are using their services more and in some cases the cost of the services themselves has also gone up and it's gone up in such a way that it was more than they originally anticipated.
This actually resulted in in management and Melina Healthcare having to reduce their outlook for the year. They originally had it closer to $19 per share in earnings and then they had to cut it because these trends were worse than they expected. But they're not alone with this. There's actually been several health insurance health services companies that have gotten hammered this year.
United Health is one of them where they announced similarly, yeah, our health cost trends have been elevated. And they had trouble understanding why. And so you've seen their guidance cut from 19 to around $14 per share. This is their current guidance. However, it is important to understand, wait a second, this is still $140 stock versus $14 adjusted earnings.
This is a $10 10 times earnings stock. This is not an expensive stock, especially for a company that has actually grown significantly over time. So why what does Michael Bur see in Melenna Healthcare beside what we've already called out? Well, first of all, none of this is financial advice. Also, quick plug.
Doug S, a premium subscriber, wrote, "I've been a member only three three months, and I'm overwhelmed by how good your services. Your average cost on some of the top holdings are several times lower than the current price. If you're looking for compelling ideas, come check out Unrivaled Investing." And so, looking at Mina Healthcare, there's a lot of interesting data points that's going on.
One of which is the fact that despite the concerns on their costs, which is largely an industry challenge, you see they're winning new contracts. For example, they just announced earlier this month that they are the sole plan selected with the Florida Agency for Healthcare Administration for about 120,000 enrolles.
So, this will be members for children and youth with special health care needs. So they continue to win market share predominantly focusing on you know Medicaid poor kids in Florida and Florida saying hey we need to be able to offer health insurance you're going to be the program that we're going to work through to say hey what's the right price that we should then pay you know the doctors the service providers the the hospitals you're going to be that we're going to work with you so that's expected to start soon and then last year they announced hey we won you know a contract with Michigan that's also expected to start in 2026 where they're ro expanding in Michigan similar types of services you know looking for you know individuals enrolled in both Medicare and Medicaid the old and the poor and so clearly seeing signs that Melenna is winning market share now that's the first data point and which is which is what I like to see this is not a melting ice cube business.
This is a business where management is working with the states and saying you have to take care of you need to make sure there are you know programs in place to take care of your poor your elderly we're going to work with you to make sure you can have a reasonable solution and the states are increasingly going to Melina they're winning market share it's not hyperrowth but they're winning market share that's an important you know green flag when you're thinking about the business The next aspect is that management has been aggressively repurchasing shares.
You can see the share count down about 10% year-over-year from around 58 million diluted shares to around 52 53 million. So aggressive share buybacks and frankly if you have a stock trading at somewhere between five and 10 times earnings, we'll talk about that in just a second. it makes sense to go crazy on your buyback because if the business is just flat going forward and here it is announcing contract wins then you have a situation where once again business just flat and you're able to deliver let's let's stick with the 10 times earnings even though you can make an argument that it might be much lower multiple in the future that means they're buying back 10% of their stock each here and so you as a shareholder all else being equal you know I think it's reasonable to expect that sort of 10% type of return that's I think another key aspect that Michael Bur is thinking about here which is that you know that share price goes up by that 10% per year I mean if it stays flat then that means management can can be even more aggressive with the share repurchase because the valuation technically gets lower so that's another key aspect you have management doing the initiatives, the management alignment.
They're showing behavior that is strongly aligned with shareholders, this aggressive buyback. So then it comes down to, okay, well, is it actually 10 times earnings because management talked about 14 $14 in adjusted earnings this year? Well, previously they were closer to 22. They're winning new contracts.
A lot of this, I mean, Warren Buffett once talked about the importance of finding businesses where there's a one-time but fixable problem. with a lot of health care. Yes, you have costs go up and they went up on average higher than a lot of folks expected. This was not just a millenna healthcare problem.
This was an industry problem. And then what happens? What what happens in the industry? You raise prices and you have a conversation with your state saying, "Look, we need to be able to make a small spread, a couple percent, 3, four, 5%. We're going to have to raise prices a bit to deal with the fact that the cost for these hospitals, these surgeons, these procedures, these medications, it costs more.
So, we need to keep our spread once again a couple percent. So, we're going to pass the cost to you. So, that's how this conversation goes. So far, they're still winning share, though. So, this makes me think this is a solvable problem. They can get ahead of it with price increases, premium increases.
You're you're going to see a lot of that in the coming weeks. You're going to see a lot of news, headline news. Oh my goodness. Premiums have gone up. There's going to be civil, you know, complaints, maybe even unrest. We'll see. Or a surge in those who are, you know, uh, not receiving insurance. But thinking about this, you know, the uninsured, I think that this reflects that Melenna, there's a chance that this is $25, you know, in earnings in the next few years.
There's a real possibility for that versus the $140 stock. So you might be talking about closer to five times earnings. And this is why Flash, I'm co-founder of Flash, free to use, leveraging the most cutting edge AI models. You know, Flash is saying, hey, there's a lot of upside here. There's potentially hundreds of percent upside.
And I think it it comes down to that understanding that if you if you truly do get to $25, let's say in earnings per share, not that long ago they were at 22. If you get to 25 sometime in the next 5 years and they're winning contracts, you know, they're able to get margins back to where it previously was.
Then with price increases, you aggressively repurchase shares. So maybe maybe 25 can go even higher because you you've been you just retired 10% of your shares. The longer the share price stays at 10 times or under, you know, the more bang for your buck, the more that that earnings per share, you know, goes up potentially.
So there's a real chance that this is a 25 maybe even $30 earning perspective in the next 5 years with these contracts with these different states. And then looking at $140 stock, investors might say, "Wow, look at the execution. They've been able to handle the cost pressure." That was industrywide.
You have insider buying it. The COO bought a $1.5 million. Maybe you have a situation where, let's do hypothetical, $30 in earnings someday. 10 times multiple. So roughly stays the same versus today that 14 $14 guidance for this year. So now you're talking about $300 stock price. Okay. So 100% upside.
Well then if you say you know 15 times multi you could see how there's a lot of upside potential when you start looking at this. So you know 100% plus upside and then layer in the fact that they're buying back 10% a year. So 10% a year plus potential multiple expansion plus potential you know earnings reset higher.
So I could see why Michael Bur like this is finding deep value in Mo stock. I hope this video has been helpful for you. .
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