Ontrak (OTRK) is a Top Pick for 2021 — and while many readers might not recognize the name, the company was my Top Pick in 2019 when it was still known as Catasys (and trading in the $10 range), asserts Nate Pile, editor of Nate's Notes.
Ontrak has developed a proprietary data analysis platform that it combines with predictive analytics and then utilizes with its customers in the insurance industry.
The goal is to identify individuals in healthcare plans who suffer from chronic conditions, but, because they may not be receiving the support they need to successfully manage these underlying conditions, they end up also costing the plan a great deal of money on other “secondary” items.
These additional costs are items like ambulance transports and visits to the ER that can be prevented (or minimized) with even a small increase in the amount of support that is provided to the patient.
After identifying which members of a plan are likely to be the best candidates for success, Ontrak's program (which happens to also be called Ontrak, hence the company's decision to change its name) kicks in.
At that point, a 52-week intensive outpatient program begins in which the patients are engaged and provided with nurses (or other appropriately qualified “coaches,” depending on the underlying situation), sometimes in person, sometimes via video conferencing (or perhaps both).
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This "coach" proactively works with the patient to gain better control of their underlying condition (which, in turn, leads to fewer “secondary” events in the patient’s life).
And, though it is hardly the reason one should consider investing in the stock, the company was, in many ways, "in the right place at the right time" during 2020, as it was one of the companies in the healthcare space that already had an infrastructure in place to do "telemedicine," and thus, it showed up on a lot of investors radar screens for the first time.
That being said, I believe the company is still in its the early stages of growth. OTRK is a strong buy on pullbacks under $45 and a buy under $70.