Polen Capital, an investment management firm, published its “Polen U.S. Small Company Growth” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 0.99% was delivered by the fund for the first quarter of 2021, trailing its Russell 2000 Growth benchmark that delivered a 4.87% gain for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Polen U.S. Small Company Growth Fund, in its Q1 2021 investor letter, mentioned Progyny, Inc. (NASDAQ: PGNY), and shared their insights on the company. Progyny, Inc. is a United States-based fertility benefits management company that currently has a $5.2 billion market capitalization. Since the beginning of the year, PGNY delivered a 39.07% return, extending its 12-month gains to 145.01%. As of May 24, 2021, the stock closed at $58.95 per share.
Here is what Polen U.S. Small Company Growth Fund has to say about Progyny, Inc. in its Q1 2021 investor letter:
“Progyny is a fertility benefits manager that works on behalf of self-insured companies and their employees to provide fertility outcomes at a lower cost. Fertility is a somewhat unique benefit in that it is rarely used and relatively expensive with extremely high tail risk cost. Additionally, providing this benefit is becoming increasingly table stakes for human-capital-centric businesses.
We think Progyny is positioned to deliver favorable outcomes because it has a fundamentally different business model.
It focuses on results and the customer experience rather than the singular focus on cost minimization like the traditional health plans with which Progyny competes. For example, Progyny provides a high-touch service with highly trained patient care advocates coordinating education, treatment, and prescriptions on behalf of providers, which seeks to reduce friction and obtain results.
We believe it can achieve such high service levels because of its simple pricing model and the way it leverages technology, which allows advocates to focus on patients. This patient-first approach combined with technology reduces tail risks for having twins, which seems innocuous but at times can be expensive and dangerous for the mother and child. This operating model has resulted in customer satisfaction at levels we have never observed before in this industry, as measured by NPS at nearly unprecedented levels for the healthcare industry. In our opinion, Progyny is in the early days of penetrating a large and rapidly
growing market. We believe this company can compound its value above our required mid-teens rate for the foreseeable future.”
Our calculations show that Progyny, Inc. (NASDAQ: PGNY) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the first quarter of 2021, Progyny, Inc. was in 26 hedge fund portfolios, compared to 24 funds in the fourth quarter of 2020. PGNY delivered a 14.96% return in the past 3 months.
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