Breaking News
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

WELL Health: A TSX Stock That Could Outperform the S&P 500 in 2022

Stock MarketsSep 18, 2021 18:15
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
WELL Health: A TSX Stock That Could Outperform the S&P 500 in 2022

The pandemic has acted as a massive tailwind for digital health companies such as WELL Health Technologies (TSX:WELL). The demand for health-tech solutions has accelerated at a rapid pace since March 2020, leading to an expanding addressable market for WELL Health and its peers.

However, investors should note that WELL stock has delivered outsized gains to long-term investors since its IPO in mid-2016. In just over five years, it has gained an astonishing 7,880% in cumulative returns. Comparatively, the S&P 500 has returned a measly 142% in this period.

While S&P 500 has gained close to 20% year to date, WELL Health has lost 1% in 2021 and is trading 13.5% below its all-time high. The ongoing pullback provides investors an opportunity to buy a quality growth stock at a lower valuation.

WELL Health stock is poised to gain momentum As economies reopen and lockdown restrictions are lifted, it might seem investors will be wary of slowing top-line growth for WELL Health. However, the company has continued to expand aggressively via acquisitions that will allow it to increase sales by 470% year over year to $286 million in 2021 and by 61% to $461 million next year. Analysts also expect its profit margins to improve from a loss per share of $0.03 in 2020 to earnings of $0.04 per share in 2022.

WELL Health continues to grow at an enviable rate and surpassed $240 million in annualized revenue run rate in Q2 of 2021. In the second quarter, the company grew sales by 484% year over year to $61.8 million. Its currently forecast to be approaching an EBITDA run-rate of $100 million after reporting a positive adjusted EBITDA in Q4 of 2020.

What’s next for investors? WELL Health has an omni-channel approach and provides primary, allied, secondary diagnostics and specialized care to all patients. At the end of Q2, it owned and operated 74 clinics in Canada and another two clinics south of the border. Its recent big-ticket acquisition of CRH (LON:CRH) Medical equips WELL Health with 77 ambulatory surgery centres in the U.S.

Its Virtual and Technology Solutions offer software, tools, and services to medical clinics and health practitioners. These solutions include electronic medical records or EMR, telehealth platforms, billing, health applications, and cybersecurity solutions. The EMR vertical is active in five countries with more than 2,800 clinics in Canada and 15,000 practitioners.

WELL Health stock is currently valued at a market cap of $1.55 billion, which means its forward price-to-2022-sales multiple is less than four, making it an extremely attractive growth stock.

Last week, the company announced its common shares will be added to the S&P/TSX Composite Index increasing trading volume and liquidity. Hamed Shahbazi, Founder and CEO of WELL, “We are extremely proud and pleased to be added to the S&P/TSX Composite Index as it is a truly momentous milestone to join such a prestigious group featuring Canada’s leading companies and brands.”

Analysts tracking WELL stock have a 12-month average price target of $11.81, which is 50% above its current trading price.

The post WELL Health: A TSX Stock That Could Outperform the S&P 500 in 2022 appeared first on The Motley Fool Canada.

Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

This Article Was First Published on The Motley Fool

WELL Health: A TSX Stock That Could Outperform the S&P 500 in 2022
 

Related Articles

5 Dividend Aristocrats Perfect for Down Markets
5 Dividend Aristocrats Perfect for Down Markets By The Motley Fool - Oct 24, 2021

Looking for solid stocks to buy in a down market? If so, Dividend Aristocrats are just what the doctor ordered. A Dividend Aristocrat is a stock that has not only paid, but also...

TFSA Pension: 2 Top TSX Stocks to Buy Now for 2022
TFSA Pension: 2 Top TSX Stocks to Buy Now for 2022 By The Motley Fool - Oct 24, 2021

Tax-Free Savings Account (TFSA) investors are looking for attractive stocks to buy for their self-directed retirement accounts heading into 2022. The winners next year could be...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email