Shares of Oscar Health (OSCR) have surged 50% over the past six months, but its rally could be just getting started as the company works to disrupt the traditional health insurance industry by improving patient outcomes.
That’s one of the key takeaways from a recent note by Ray Myers, an analyst and author of the Global Equity Briefing investment blog.
Myers described Oscar as a “health insurance disruptor” with the potential to increase its share price fivefold in the foreseeable future, thanks to its differentiated approach compared to traditional insurers.
“Traditional insurers largely act as claims processors. They set up clinical networks, negotiate rates with hospitals, and then pay providers for services rendered,” Myers wrote. “They have very little direct control or influence over how care is delivered or whether it’s truly necessary.”
“Oscar, on the other hand, works directly with the patient and the doctors to improve outcomes and reduce costs,” he explained. The company achieves this by integrating with Oscar Medical Group, a separate entity that provides medical services exclusively to Oscar Health members.
Oscar’s app collects health insights from users and sends them timely medication reminders. It’s been highly popular, earning 98% positive reviews and a 4.9-star rating on the Apple App Store.
Given these factors, analysts anticipate that Oscar’s revenue and earnings will continue to grow for the foreseeable future.
Oscar is “attractively priced”
With a share price of around $20 and a market cap of $5.2 billion, Oscar Health is “attractively priced” despite its high trailing 12-month P/E ratio, according to Myers.
Higher operating efficiencies are expected to significantly boost Oscar’s profitability, with net income projected to grow by more than 2,300% over the next three years, Myers said.
Meanwhile, Wall Street analysts forecast that Oscar’s revenue will increase by 22.5% this year and more than 42% by 2027.
All said, Wall Street expects Oscar’s earnings to grow 24-fold over the next three years, Myers added.
Oscar became profitable for the first time in 2024, posting an annual net income of $25.4 million - a dramatic turnaround from a net loss of more than $270 million the year before. This profitability was driven by record enrollments and strong revenue growth.
The company carried that momentum into the first quarter of 2025, reporting a 42% increase in revenue to $3.046 billion and net income of $275 million.
It ended the quarter with approximately 2 million health plan members, up 40% from one year earlier.
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