Insiders at the boardroom level not only have access to real-time information but they are also likely to understand the company’s business model and the factors that determine its success or failure, better than outsiders looking in. If these insiders are buying company stock, then it is usually a positive development.
Here, we are going to highlight insider purchases at Cano Health Inc (CANO:US). Cano Health Inc is a healthcare specialist that focuses on senior care as well as primary care for all ages in the US States of Florida, Nevada, New Mexico and Texas as well as Puerto Rico. The company aims to grow organically and through acquisitions to become the leading provider of primary care in the US.
Cano Health Inc: Insider Buying
Regulatory filings show that between 16 and 31 August, Founder, President/CEO at Cano Health, Marlow Hernandez, aggressively purchased CANO stock and warrants. In total, the insider spent just over $17.1 million on stock and warrants.
Meanwhile, between 25 and 30 August, Chief Clinical Officer, Richard Aguilar, bought CANO stock and warrants worth $8.673 million.
High Value Insider Buying
These insider transactions came to our attention given the high monetary value of the purchases. In spending nearly $25 million between them, the insiders are signaling that they are extremely confident in the company’s future prospects.
Additionally, our Insider Model gives Cano Health a score of 3 out of 5. This affirms what insider trading is suggesting and indicates that the insider sentiment within the company is positive.
Numbers Boosted by the Recent Acquisition
Cano Health recently increased its guidance for 2021 and 2022 after the acquisition of Doctor’s Medical Center. Full-year adjusted EBITDA was increased to $110 million from $100 million to $110 million and full-year adjusted EBITDA for 2022 was raised from $135 million to $150 million.
The purchase – which cost the group $300 million – brought 18 Florida medical centers into the Cano Health family and further enhanced the company’s leading position in Florida. The estimated stand-alone full-year revenue for Doctor’s Medical Center is $194 million with $106 million coming in the second half of 2021. Adjusted full-year EBITDA is estimated to be $22 million.
“Cano Health is on a mission to become America’s Primary Care, and today’s acquisition brings us one step closer to that important goal. With DMC as part of the Cano Health family, we are bringing our care model to more patients and acquiring important footprint and infrastructure to further improve the clinical outcomes of underserved patients,” said Dr Marlow Hernandez, Founder, President and CEO of Cano Health.
Having digested the recent update on Cano Health’s strategic acquisition, we see the recent insider buying as bullish. It suggests that the insiders are confident in the company’s strategy to build value through acquisitions and that they believe the shares are currently undervalued by the market.