WELL Health Posts 150% Revenue Growth In 1Q; Shares Drop 4%

Shares of WELL Health Technologies Corp (WELL) fell more than 4% in early trading Tuesday despite the strong growth in revenues in the first quarter of 2021.

The omnichannel digital health company’s revenue for 1Q 2021 came in at C$25.6 million, an increase of 150% from the C$10.2 million revenue reported in 1Q 2020. WELL Health’s solid first-quarter performance was driven by its Software and Services 345% revenue growth year-over-year.

Meanwhile, adjusted EBITDA was C$0.5 million for 1Q 2021, compared to a loss in adjusted EBITDA of C$0.2 million for 1Q 2020. WELL Health’s Canadian operations provided a positive contribution to the results, achieving an adjusted EBITDA of C$1.1 million.

The company reported a net loss of C$7.1 million (C$-0.04 per share) in the first quarter, compared to a loss of C$2.0 million (C$-0.02 per share) in the same quarter a year earlier.

WELL Health’s Chairman and CEO Hamed Shahbazi said, “We are very pleased with our results from Q1-2021, in which quarterly revenue increased by 150% compared to the same period last year and we surpassed C$100 million annualized revenue run-rate. During Q1 we also announced the acquisition of CRH and subsequently closed the transaction in Q2, which puts us on track for an annualized revenue run-rate approaching $300 million. CRH accelerates our revenue growth and significantly boosts our free cash flow, which will be used to make additional cash flow generating acquisitions. I am also pleased to report that CRH, now operating as a stand-alone WELL business unit, is on track to meet its business plan goals to generate over US$150M in revenues and over US$40M in free cash flow before leverage and tax costs.” (See WELL Health Technologies Corp stock analysis on TipRanks.)

Two weeks ago, Echelon Wealth Partners analyst Rob Goff maintained a Buy rating on the stock with a C$12.00 price target for a 64.2% upside potential.

Overall, WELL Health stock scores a Strong Buy consensus rating based on 7 Buys. The average analyst price target of C$11.00 implies a 58% upside potential from current levels. Shares have more than doubled in value over the last year.