Quotes on Canadian clinic owner Well rise on record revenue

Shares of Well Health Technologies, which owns outpatient health clinics in Canada and develops healthcare IT platforms, rose nearly 4% on the Toronto Stock Exchange today, Thursday, August 15. The company reported record revenue and profit for the second quarter and raised its annual guidance.

Details

On the Toronto Stock Exchange, Well stock added 3.8% at one point to CAD4.61 per share ($3.36), partially paring the previous day’s losses, when the stock fell 4.3%. That same day, the stock declined 4.1% in OTC trading in the U.S.

Record quarterly results

On Wednesday, August 14, Well released its second-quarter financial results. Its revenue reached a record $243.1 million, 42% higher than the same quarter in 2023, while adjusted EBITDA grew 11% year-over-year to a record $30.9 million. The number of patient visits rose 38% to a company-high 1.4 million.

Still, when compared to the same period last year, adjusted net income declined from $14.4 million to $12.3 million, or from $0.06 per share to $0.05 per share. These figures are roughly in line with the average analyst forecasts, according to FactSet. The second quarter of 2024 “exceeded expectations,” said company founder and CEO Hamed Shahbazi. As a result, Well raised its annual revenue guidance range to $970-990 million. This is the second upgrade since the beginning of the year. After the first quarter, the company had raised the guidance to $960-980 million from the initial $950-970 million.

“We are on track to achieve one billion in revenues by the end of 2024,” said Shahbazi. “We remain focused on enhancing profitability and capital efficiency and continue to project a 30% year-over-year increase in free cash flow to shareholders in 2024.”

Analyst recommendations

Fifteen analysts cover Well. Fourteen of them recommend buying the stock (twelve buy ratings and two overweight), while one rates it a hold. The average target price is $7.60 per share, indicating nearly 135% upside.

About Well

Well describes itself as the largest owner and operator of outpatient clinics in Canada and a leading provider of multidisciplinary digital health services. In the first quarter, the company restructured into three groups: primary and specialized healthcare in Canada, platform solutions, and Well Health USA, which manages operations in the U.S. The goal was to “enhance operational efficiency.”