E 4 Mental Health Stocks Got My Mind Made Up

As per the WHO, nations need to substantially increase investments in mental health services or face an upsurge of mental-health-related complications. To get a sense of how rapidly mental health cases multiplied after recent events, check the data mined by Springer (image below). What’s depressing is that the data are up to May 2020. The situation may have worsened since.

Image Source: Springer

Recent data suggests that our younger generation (ages 18-44) is the worst impacted by mental health issues. There’s little doubt that nations will soon start addressing the mental health issue on a war footing.

I’ve drawn up a list of 4 track-worthy biotech companies that help promote mental health. These are not buying recommendations – these are stocks that you can consider tracking. Here’s the list:

1. Intra-Cellular Therapies (ITCI)
Price: $24.46, Market Cap: $1.96B

ITCI currently manufactures Caplyta (lumateperone), a drug used in the treatment of schizophrenia. It won FDA’s approval in December 2019, but its marketing efforts were stalled by COVID-19.

The company is currently developing (pipeline) the following drugs:

(a) ITI-007, which helps treat bipolar depression, behavioral disturbances associated with ADHD or dementia, and depressive disorders.

Image Source: The ITCI Website

(b) PDE Inhibitors that help treat Parkinson’s disease and heart conditions.

As the company’s marketing has not started, analyzing its financials won’t make sense now. Investors can track the progress of Caplyta and other pipeline drugs. Investors are chasing this stock, which is why it is currently quoting at an unattractive high Forward Price-to-Sales multiple of 89.72.

2. Acadia Healthcare (ACHC)
Price: $38.29, Market Cap: $3.43B

ACHC helps treat behavioral health conditions and addiction issues in its facilities in the U.S. and U.K. The company reports positive operating profits and cash flows every quarter. However, its trade receivables work up to about 40%+ of sales per quarter, which is steep. An analyst has opined that the company books all billables as income and then writes off the amount that’s not paid by insurers. However, despite this accounting practice, the company has reported a healthy Levered FCF TTM Margin of 7.27% and Cash from Operations of $591.6 million as of Q3 2020.

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Disclosure: I have no position in the stocks discussed, and neither do I plan to buy/sell it in the next 72 hours. I researched and wrote this article. I am not being compensated for it (other ...

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