Consumer-focused digital healthcare platform GoodRx Holdings, Inc. (NASDAQ:GDRX) is gradually losing the charm that it created with its blockbuster debut on the NASDAQ two years ago. Shares of this online drug prescription platform have declined around 87.9% since its listing. Unfortunately, GDRX stock has fallen 85.4% over the past year, 81.2% year-to-date, and 19.5% in the last three months.
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What Does GoodRx Do?
Headquartered in California, GoodRx finds prescription drugs at a discount. The company tracks drug prices by gathering information from various pharmacies in the U.S. and offers discount coupons. It charges fees from pharmacy benefits managers associated with it.
A Snapshot of GoodRx’s IPO
GoodRx became a member of the Nasdaq after an initial public offering (IPO) of its 28.61 million shares of Class A common stock at $33 per share. Through the IPO, the company raised $886.9 million in net proceeds (after deducting the underwriting discounts and offering costs).
Shares of the company closed at $50.50 on the first day of trading (on September 23, 2020), up nearly 53% from the IPO price. GDRX’s stock touched its all-time high closing price of $57.16 in October 2020. Presently, GoodRx commands a market capitalization of $2.27 billion.
Recent Developments at GDRX
GoodRx has been witnessing solid growth in revenues from its Pharma Manufacturer Solutions and Subscription segments. The company is also upbeat about the fourth-quarter prescription transaction revenues. Further, GDRX projects a persistent year-over-year surge in Pharma Manufacturer Solutions business on the back of increasing pharma ad spending on digital platforms.
GoodRx’s Subscription revenue rose 82% year-over-year in the second quarter of 2022, largely due to a one-time surge in monthly subscription fees. The company exited the quarter with 1.1 million planned subscriptions.
As of now, due to the fee hike, the company expects a slowdown in its Subscription revenue in the quarter ahead.
Not only this, GDRX recently announced that it will slash 16% of its workforce under a cost restructuring initiative to accelerate growth and enhance margins.
Is GoodRx Stock a Good Buy?
The stock is giving mixed signals. According to TipRanks, the Street has a Hold consensus rating on GDRX stock, which is based on four Buys, 10 Holds, and one Sell.
Hedge funds, too, look apprehensive about GoodRx, as they have sold 2.3 million shares of GDRX in the last quarter.
Contrary to the analysts and hedge funds, financial bloggers on TipRanks are 83% Bullish on GDRX stock, compared to the sector average of 65%. Further, retail investors have increased their holdings in GDRX stock by 4.2% in the last 30 days.
Ending Thoughts
GoodRx is making significant efforts to expand its reach and grow. The company’s management is confident about its long-term growth potential and profitability. Further, GDRX’s average price forecast of 10.20 implies 78.9% upside potential.
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