Good afternoon Readers,
Apologies for not alerting you the cost of equity equation running into some hiccups due to COVID last year.
My take on it is, I am expecting inflation, and I do not have the time or datasets to accurately price it. I also think, a writer at Zero Hedge deserves a big thank you from market participants for alerting readers to the potential of algos miscalculating market prices on the 15th due to the same hiccup this model ran into.
Until I can get a more educated and precise perspective on PPP prices and the Fed’s impressive ability to stabilize them, the model will rely on estimations made under the assumption that interest rates will be slowly rising, and stocks with ability to quickly pass on their inventory costs to customers due to inelastic pricing will outperform companies with high inventory costs. I am also looking for disclosures relating to the physical selling of crypto currencies from retailers.
Regarding Inventory costs for CVS, I will be judging them, based on their inventory turnover ratio on line 249 of the balance sheet of the model. To be honest, I am not impressed with this company and my assumptions reflect that.
Regarding Relevant news, Seeking Alpha posted the below pertinent information for the stock today on their non-subscription news feed. I think for those of you who can afford it, their subscription is well worth the price.
· Appointments for the latest allocation of approximately 570,000 doses will start to become available for booking today, with shots beginning February 25.
Also, of interest for this stock’s long term growth perspective is Seeking Alpha’s estimation of the Healthcare Insurance Market.
I once had a very bright economics professor tell me that if you subsidize some something, you will get more of it. I have not seen this disproved yet.
Therefore, I concur in the near term with Donavan, but I believe his opinion is uneducated and the Government will force a takeover of the industry well before 2027 under the guise of mismanagement of Medicaid/Medicare payments, which in my opinion is intentionally left lightly regulated.
If this is not the case, our elected officials should demand that Healthcare Providers and Pharmacies provide upfront prices to customers for their review. This would allow customers to not only judge the benefits of their insurance coverage but would help keep the medical care providers and pharmacies honest as well.
Warmest Regards,
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