It should come as no surprise that people want to spend as much of their golden years in their own homes as possible. These days, companies are stepping up to help make that happen. Baby boomers are either retiring or approaching, and their impact on the economy is significant. According to the US Census Bureau, the generation born between 1946 and 1964 began turning 65 in 2011 and will all be over 65 by 2030. By 2034, older people will outnumber children for the first time in history, the bureau said. “If you look at developed markets, it’s pretty clear that we’re going to have almost an inverted or upside down demographic triangle as birth rates slow,” said Michel Laliberte, thematic investment strategist at UBS. “People are living longer.” According to the Centers for Disease Control, the life expectancy of Americans is about 76 years. Although this has decreased over the past two years, mainly due to the Covid-19 pandemic, the trend has been upward throughout history. For example, according to the CDC, the life expectancy in the United States in 1950 was 68. “A lot of companies see this as an investment opportunity,” said Miriam Sznycer-Taub, managing director of aging population research at the Washington-based research firm The Advisory Council. The ‘underserved’ opportunity While there are some pure plays on the trend, such as home healthcare providers Addus Homecare and Amedisys, technology companies are also stepping up to support things like remote monitoring. Tech will also help seniors stay connected and support virtual doctor visits. “Most of the products and services targeting this group have historically focused on healthcare and recreation,” said Brian Miller, head of ETF Platform at Hartford Funds. “Those areas are important, of course, but we think there’s a lot more potential. And it’s kind of underserved.” His firm has an exchange-traded fund, the Hartford Longevity Economy ETF, designed to invest in the world’s aging population. “Alifba”, “Amazon” and “Best Buy” are among the plays prepared by the foundation on “aging on earth”. According to Morningstar, the ETF had a total return of -15.74% in 2022, but is up 2.06% so far this year. For example, Amazon has Alexa Together, which has a remote maintenance service, 24/7 emergency response, fall detection response and other assistance. Alphabet has its own smart-home system, Google Nest. Apple also has ambitions to disrupt healthcare, with CEO Tim Cook once saying it would be Apple’s “greatest contribution to humanity”. Apple Watch features include fall detection alerts, integration with third-party health apps, and an electrocardiogram to detect heart rhythm irregularities. Of course, senior citizens should be comfortable with this technology. “It’s hard to predict the speed of technology change and adoption, but I think we’re in a really interesting time right now,” said UBS’s Laliberte. “We’re starting to see more adoption and better tech literacy, and I think that opens the door for more innovation in the future.” Of course, as younger, tech-savvy generations age, this barrier to entry won’t necessarily be there. Best Buy Goes Into Space It’s Best Buy that’s really doubling down on its efforts to get into the space. The retailer has made a number of acquisitions over the past few years, including Critical Signal Technologies, a premium remote monitoring service, in 2019. In 2021, Best Buy acquired Current Health, a technology company that facilitates remote patient monitoring and telehealth. The company also partners with NYU Langone Health, Geisinger Health and Mount Sinai Health health systems. Best Buy sees the role of technology in healthcare becoming more important. “Consumers today want care in their own homes, and providers are rapidly looking for ways to incorporate digital tools into the healthcare process to improve outcomes for their patients,” Best Buy Health CEO Deborah Di Sanzo told CNBC in an email. “We have a unique ability to provide home care for everyone by leveraging our omnichannel expertise, services, logistics, connected technology, human connection and the ability to enable a home care platform,” he said. This includes services like Geek Squad, which can install the technology in the home and teach seniors and their caregivers how to use it. Health is still a relatively small part of Best Buy’s business, but over the long term it could become a bigger part of the company and a growth driver, said DA Davidson analyst Mike Baker. “It’s a huge market opportunity,” he said. BBY 1Y mountain Best Buy is increasing its “obsolete in place” services. Baker has a buy rating and a $99 price target on the stock, which represents a 21% upside from Thursday’s close. He said stocks were cheap and he was already pricing in a lot of bad news ahead, such as disappointing holiday sales and the prospect of weak economic growth this year. Demand may be down from pandemic highs, but the home will still be a hub for entertainment, Baker said. He is faster than many of his peers. According to FactSet, the average analyst rating on the stock is Hold, and the average price target means a 2.6% decline. Medicare Advantage bucks the trend It’s not just technology that’s allowing people to stay in their own homes longer. There are many things at home, including personal and health services and home modifications. Meals can be delivered and Ubers can be hired instead of seniors driving their own cars. Kitchen counters can be lowered and bathtubs can be modified to make them more accessible. Managing Director of Deloitte Health Solutions and Health Equity Center Dr. “Aging in place, this trend is really driving greater independence, aging with dignity, improved emotional well-being and cost savings across the system,” said Jay Bhatt. Institute. “There is increasing evidence that most older people feel safer receiving care in their own homes and are more satisfied with the care they receive when they are in a familiar and comfortable environment,” she said. There is an obvious desire to do this. According to the University of Michigan Institute for Health Policy and Innovation’s National Survey on Healthy Aging, about 88% of those ages 50 to 80 say it is very or somewhat important to live in their homes as long as possible. . Approximately 2,277 adults between the ages of 50 and 80 were surveyed in January and February 2022 and then sampled to reflect the US population. Advisory Board member Sznycer-Taub said not only is a growing senior population helping to manage the age issue, but so is the growth of Medicare Advantage. Medicare Advantage, sometimes called Part C, is a way to get Medicare coverage through private health plans and essentially combines both basic coverage and Part A, as well as Part B, outpatient services. Most also include prescription coverage. “Medicare Advantage plans are really interested in keeping beneficiaries in their homes as part of their efforts to reduce health care costs,” he said. Home health care covered by Medicare Advantage includes primary care, transitional care when someone is discharged from the hospital, and often hospice care, she said. More than 30 million Americans are currently enrolled in a Medicare Advantage plan. With a market cap of about $1.7 billion, Addus Homecare is one of the leading providers of personal care, hospice and home health services. ADUS 1Y mountain Addus Homecare’s one-year performance Raymond James has an Outperform rating on the stock and a $125 price target, representing a roughly 17% upside from Thursday’s close. Both are in line with FactSet averages. About 25% of the people Addus Homecare pays to care for beneficiaries are their own family members, he said. “Any provider that lowers the cost of the insurance company is going to be in a good place,” said John Ransom, managing director of healthcare equity research at Raymond James. “They save insurance companies at least 50% of the cost of sending an individual to a nursing home.” Another home health provider is Amedisys, which has a market cap of $3 billion. Ransom has a market perform rating on the stock and lowered its 2023 earnings before interest, taxes, depreciation and amortization (EBITDA) estimate to $250 million earlier this month. Among the reasons it cited were labor inflation and higher losses from Contessa, the home hospital company it bought in 2021. However, the average rating of analysts is overweight, according to FactSet. The stock rose nearly 22% above the average analyst price target. AMED 1Y mountain Amedisys’ one-year performance CVS Health is also looking to expand into home health and announced in September that it would acquire Signify Health, which offers patient care through virtual and in-person visits. CVS is also the parent of Aetna, a Medicare Advantage plan provider. The company has an average analyst rating of buy and is 30% above the average price target for FactSet. A telemedicine name that doesn’t require a Wall Street rally is telehealth services platform Teladoc Health, which rose during the pandemic but has lost 74% in 2022. The average analyst rating is holding, although it is still about 28% above the average analyst price target. Teladoc recently announced a restructuring plan to cut operating costs and this week laid off 300 employees, or 6% of its workforce. Changes at home are key. Then there are the names that influence the physical structure and landscaping of the home, namely Home Depot and Lowe’s. Both names are in Miller’s Hartford Longevity Economy ETF. “Home improvements and changes are very important,” he said. “It’s a more functional living space with increased accessibility, the idea of single-story living spaces [and] safety modifications.” This can be not only ramp covers or stair lifts, but also more user-friendly devices for the shower with large buttons and handles. Both home improvement retailers focus on this segment of the population — Home Depot is a stand-alone residential program, while Lowe’s has livable home services. DA Davidson’s Baker likes Lowe’s, although the aging location segment is a very small part of his investment thesis. He expects Lowe’s to begin closing the performance gap against a number of measures. Home Depot. That should lead to higher earnings power, said Baker, who has a buy rating and a $237 price target on Lowe’s stock. That represents a 17% upside from Thursday’s close. Is there a window ahead? Right now, seniors and their caregivers every bringing things together — for example, from technology companies and home health and individual to help with monitoring i Using another company for maintenance services and another company for home modifications. tries to solve problems as they arise. Joseph Coughlin, director of the MIT AgeLab and author of The Longevity Economy, said the big opportunity — and need — is for one company to bring it all together. Those who do will have “demographic and lifestyle tailwinds at their backs,” he said. “Aging in place will eventually become a subscription to a trusted brand that will tie together all these other services and products,” Coughlin said. In fact, he believes it will happen within the next five years. MIT is currently working with companies that want to do this. While he didn’t name names, he thinks Best Buy is the closest so far with its in-store options and health expansion. “The biggest innovation in this store is Geek Squad – not just for installation [tech] but to solve problems,” he said. What’s offered may have to change as baby boomers get older and sicker. “A lot of these companies that are investing in aging in place may have to change what they’re offering because they’re going to be dealing with a different group of people,” said Advisory Board Member Sznycer-Taub One thing that will not change is the desire to stay at home as long as possible.