Can you make gains with Well Health (TSX:WELL) stock in 2021?

Summary 

  • Stocks of WELL Health Technologies climbed 1.4 per cent on Tuesday, July 21.
  • As the pandemic continues to rage and the digital healthcare industry’s demand expands, it is likely that the firm could reflect growth opportunities.
  • The global telehealth industry is estimated to value at US$ 559.52 billion by 2027, as per a report.

After noting a decline of four per cent in the last one month, stocks of WELL Health Technologies Corp. (TSX:WELL) climbed about 1.4 per cent to close at C$ 7.46 apiece on Tuesday, July 21.

As the coronavirus pandemic continues to rage and the digital healthcare industry’s demand expands, it is likely that the Canadian telehealth firm could reflect growth opportunities. It appears to be focussing on business expansion at the moment, which could impact its services and demand positively going forth.

On that note, let us explore WELL Health’s stock performance and latest operations.

WELL Health becomes Canada’s biggest operator of outpatient medical clinics

On July 15, the Canadian enterprise announced that it has completed the acquisition of health services provider MyHealth, becoming the country’s biggest owner and operator of outpatient clinics.

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In the wake of this deal, the strength of WELL Health's medical staff has increased as MyHealth brought in over 760 physicians and other healthcare professionals. In addition, as 75 per cent of MyHealth's business was carried out via telehealth consultations, WELL Health is now among the leading multi-disciplinary telehealth services providers in the country.

The telehealth company is estimated to benefit from the deal in terms of revenues. WELL Health expects the combined firm’s pro forma revenue run-rate to be around C$ 400 million, and the EBITDA run-rate to be around C$ 100 million.

WELL Health's (TSX:WELL) performance and future outlook


WELL Health recorded revenues of C$ 25.6 million in Q1 2021, representing an increase of 150 per cent year-over-year (YoY). The company pointed that its revenues from the software and services segment, which surged by 345 per cent YoY in Q1 2021, was behind this unprecedented growth.

The telehealth company achieved a record adjusted gross profit of C$ 10 million in Q1 2021, as compared to that of C$ 3.9 million in Q1 2020.

As for its stock performance, WELL shares returned about 138 per cent in the last twelve months.

At market close on Tuesday, July 20, WELL stock was available for 24 per cent less than its 52-week high of C$ 9.84.

1-year chart of stock performance, volume and moving average multiple of WELL Health (Source: Refinitiv)

According to a Fortune Business Insight report, the global telehealth industry is estimated to value at US$ 559.52 billion by 2027, and will likely exhibit a compound annual growth rate of 25.2 per cent during this period. This growth, as pointed above, could bear well for WELL Health in the future.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view. The reference data in this article has been partly sourced from Refinitiv.

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