With 2024 starting with new leadership, most notably with John Powers at the helm, hope springs eternal among patient investors.
“MARPAI is a cutting-edge technology-powered TPA supporting employers with self-funded health plans. We strive to lower costs while providing better healthcare options for employees and their families.”
To attract, retain and motivate the insurance brokerage community towards record breaking company growth, Marpai would be wise to offer stock ownership to qualifying agents and brokers. Shares could be gifted for each group sold and/or a certain number of shares gifted based on the number of covered lives, tied to a vesting schedule. This concept is not new as AFLAC has been offering ownership interest for producing agents for years, a helpful strategy in retention and agent loyalty.
Market Cool On Marpai, Inc.’s (NASDAQ:MRAI) Revenues Pushing Shares 26% Lower
January 6, 2024
Marpai, Inc. (NASDAQ:MRAI) shares have retraced a considerable 26% in the last month, reversing a fair amount of their solid recent performance. For any long-term shareholders, the last month ends a year to forget by locking in a 54% share price decline.
Following the heavy fall in price, given about half the companies operating in the United States’ Insurance industry have price-to-sales ratios (or “P/S”) above 1x, you may consider Marpai as an attractive investment with its 0.3x P/S ratio. Although, it’s not wise to just take the P/S at face value as there may be an explanation why it’s limited.
See our latest analysis for Marpai
What Does Marpai’s Recent Performance Look Like?
Recent times have been advantageous for Marpai as its revenues have been rising faster than most other companies. It might be that many expect the strong revenue performance to degrade substantially, which has repressed the share price, and thus the P/S ratio. If you like the company, you’d be hoping this isn’t the case so that you could potentially pick up some stock while it’s out of favour.
Keen to find out how analysts think Marpai’s future stacks up against the industry? In that case, our
Is There Any Revenue Growth Forecasted For Marpai?
In order to justify its P/S ratio, Marpai would need to produce sluggish growth that’s trailing the industry.
Retrospectively, the last year delivered an exceptional 60% gain to the company’s top line. Still, revenue has barely risen at all from three years ago in total, which is not ideal. So it appears to us that the company has had a mixed result in terms of growing revenue over that time.
Turning to the outlook, the next year should generate growth of 6.4% as estimated by the one analyst watching the company. With the industry predicted to deliver 6.3% growth , the company is positioned for a comparable revenue result.
With this in consideration, we find it intriguing that Marpai’s P/S is lagging behind its industry peers. It may be that most investors are not convinced the company can achieve future growth expectations.
The Key Takeaway
Marpai’s recently weak share price has pulled its P/S back below other Insurance companies. Generally, our preference is to limit the use of the price-to-sales ratio to establishing what the market thinks about the overall health of a company.
Our examination of Marpai’s revealed that its P/S remains low despite analyst forecasts of revenue growth matching the wider industry. The low P/S could be an indication that the revenue growth estimates are being questioned by the market. Perhaps investors are concerned that the company could underperform against the forecasts over the near term.
We don’t want to rain on the parade too much, but we did also find 5 warning signs for Marpai (3 are a bit unpleasant!) that you need to be mindful of.
It’s important to make sure you look for a great company, not just the first idea you come across. So if growing profitability aligns with your idea of a great company, take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
