What happened

Shares of primary care and health clinic company Cano Health (NYSE:CANO) are up 9.7% late on Monday following the initiation of analyst coverage by Credit Suisse. The investment bank rates Cano Health an outperform, with a price target of $18 per share.

So what

It's not exactly a household name. Cano Health sports a modest market cap of $2 billion, and its clinic network only drives on the order of $600 million worth of annual revenue. Earnings before interest, taxes, depreciation, and amortization, or EBITDA, for the past 12 months is $52.4 million, in line with the healthcare clinic industry's margin norms. It's also a relatively young company, going public late last year via a special purpose acquisition company (SPAC) in the midst of a pandemic. It's not had much of a chance to tell its story to undistracted investors.

Rising digital stock chart being drawn by a person wearing a suit.

Image source: Getty Images.

The story of the company's strategy, however, is starting to get noticed... and liked. Cano Health has made a series of acquisitions in recent months, and Credit Suisse's marks the second bullish call on the company's approach. The other price targets sit at an even higher level of $22, versus the stock's present price of less than $12 per share.

Now what

Young companies -- particularly ones that came to the market unconventionally -- that are buying their growth are difficult to handicap, leading to volatility. This one is no exception.

For investors willing to speculate a bit, though, there's potential here. The stock's 30% rout since early June leaves it more or less where it was when it first came to the market, which may be where investors are collectively drawing a mental line in the sand. It's still high-risk, but the risk seems limited relative to the reward.