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Stocks of Well Health Technologies Corp (TSX:WELL) increased by 3.54 per cent on Monday, May 5, after its subsidiary CRH Medical acquired an 85 per cent stake in US-based New England Anesthesia Associates LLC.
Following this purchase, the company’s current projected yearly revenue could grow by nearly US$ 3.6 million. Meanwhile, its operating EBITDA margins are likely to remain at 40 per cent.
Vancouver-based WELL Health Tech, a clinical and digital health service provider, purchased a 100 per cent stake in CRH Medical Corporation earlier in April. The transaction was for US$ 4 per share in cash, indicating a total amount of nearly US$ 286.6 million, and the final deal value of almost US$ 372.9 million.
WELL’s Software as a Services (SaaS) product has been gaining momentum, and the company expects to improve C$ 3 million in annual revenue from its proposed acquisition of ExecHealth.
This year, CRH Medical has concluded four healthcare-related transactions and accelerated Well’s operations to 16 states across the US.
Let us look at the stock’s movement on the back of the latest acquisition spree:
WELL Health Technologies Corp (TSX:WELL)
The demand for tele-healthcare solutions has risen across Canada amid the COVID-19 led lockdowns. As a result, healthcare stocks also noted a spike.
WELL Health stock gained almost 143 per cent in the last one year, boosted by the demand in digital health services. In the long-term movement, the stock was up 2.5 per cent from the 200-Day simple moving average (SMA). It could take a bullish ride in the wake of its back-to-back successful acquisitions.
It is up 192.4 per cent against its 52-week low of C$ 2.5 per share (June 12, 2020) and almost 26 per cent down from its 52-week high of 9.84 apiece (February 8, 2021), as per EODHD/Others data.
The healthcare stock has rebounded nearly 2 per cent quarter-to-date (QTD).
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WELL posted revenues of C$ 17.2 million, a 75 per cent increase on a year-over-year (YoY) basis in Q4 2020. This was guided by SaaS revenues, which rose 400 per cent YoY to $5.8 million in Q4 2020 against C$ 1.2 in Q4 2019.
WELL plans to release its first-quarter results on Tuesday, May 11.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.
