Shares of Signify Health (SGFY) have continued to trade up on rumors of CVS Health Corp’s (CVS) interest in acquiring the company.
Signify Health is exploring strategic alternatives, including a sale, the Wall Street Journal reported last month. Initial bids were due the following week, and CVS is planning to enter one, sources told the WSJ. Others are reportedly also in the mix, and CVS could face competition from other managed care providers and private equity firms.
News of the potential acquisition comes after Amazon’s recent acquisition of One Medical, suggesting an emerging pattern of consolidation in the digital healthcare space, ARK Invest wrote in a recent commentary. Signify Health seeks to activate the home as central to healthcare, enabling its members to avoid inefficient and unnecessary medical costs.
Shares of Signify traded up about 32% last Monday on the news. The stock is up over 63% in the past month and has held steady in the past week, increasing 0.14%.
Signify is the top holding in the ARK Genomic Revolution ETF (ARKG), weighted at 6.80% as of September 1, according to ARK Invest. Other top holdings in ARKG include Exact Sciences Corp (EXAS, 6.57% weight as of September 1) and Ionis Pharmaceuticals Inc (IONS, 6.11% weight as of September 1).
ARKG is an actively managed equity strategy that aims to provide exposure to DNA sequencing technology, gene editing, CRISPR, therapeutics, agricultural biology, and molecular diagnostics.
Companies within ARKG are focused on and are expected to substantially benefit from extending and enhancing the quality of human and other life by incorporating technological and scientific developments and advancements in genomics into their businesses, according to the firm.
ARKG typically holds between 40 and 60 securities and charges an expense ratio of 75 basis points.
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