GoodRx tumbles as BofA downgrades to 'underperform', cuts PT to Street low

GoodRx Holdings

02/01/2024 19:02

** Shares of digital healthcare platform GoodRx  GDRX.O 
fall as much as 18.7% to an over one-month low of $5.45     
    ** Stock set for its biggest one-day percentage drop in two
months if losses hold
    ** BofA Global Research downgrades to "underperform" from
"buy" and cuts price objective to a Street low of $4.5 from $8
    ** Brokerage says GDRX "makes money" from pharmacy benefit
managers' (PBM) reimbursement that vary substantially
    ** Changes in the PBM competitive landscape such as CVS
Health's  CVS.N  new pharmacy reimbursement model that could
standardize reimbursements could threaten GDRX's business -
brokerage
    ** GDRX negotiates prices for filling prescriptions with
several PBMs and provides consumers access to these through its
app or discount card
    ** BofA says discount programs by PBM units of insurers
UnitedHealth Group  UNH.N  and Elevance Health  ELV.N , and
drugstore chain Walgreens  WBA.O  allowing access to third-party
discount cards increase competition 
    ** GDRX stock rose 43.8% in 2023

 (Reporting by Puyaan Singh)
 ((Puyaan.Singh@thomsonreuters.com;))