2023-03-07 09:01:00 ET
LifeStance Health Group ( NASDAQ: LFST ) rose 1.7% in premarket trading as Hedgeye added the mental health services provider as a long idea with the potential for 400% upside from current levels.
"We believe LFST is currently at an inflection point where several industry and operational headwinds are poised to turn positive," Hedgeye analyst Tom Tobin wrote in a note on Tuesday. "Key among these positives is new leadership committed to fix the operational problems we heard so much about from former employees. The secular tailwinds for the demand for mental health services have accelerated over the last 3 years, and so too has the labor market for mental health professionals. Labor scarcity and wage inflations has been has limited Lifestance's ability to grow, but there are signs those constraints are easing."
Hedgeye expects that a weaker economy may lead to an uptick in demand for mental health services and patients may shift to LifeStance ( LFST ) as it takes health insurance, which is the minority of all available therapists.
LifeStance ( LFST ) shares may trade between $10 and $20 a share, representing upside of 100% to 400%. from current levels.
Hedgeye is hosting a presentation on LifeStance ( LFST ) on Thursday.
LifeStance ( LFST ) short interest is 12%.
LifeStance ( LFST ) is set to report Q4 results on Wednesday.
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LifeStance gains as Hedgeye adds as new long idea