Yahoo Finance WELL Stock: Buy, Sell, or Hold?
Written by Karen Thomas, MSc, CFA at The Motley Fool Canada
WELL Health Technologies Corp. (TSX:WELL) has rapidly grown over the last few years – from just $32 million in revenue in 2019, to $776 million in 2023. While WELL stock is up 456% during this same time period, it’s fallen 62% from its 2021 highs.
What should investors do with this stock today?
WELL stock is a volatile one but the business keeps growing
Although WELL stock has been all over the place in the last few years, its growth trajectory has not – it’s been pretty consistently up. In fact, WELL Health’s revenue has grown over 2,000% to $776 million in 2023. The problem, however, is that earnings have been hard to come by. While this is typical of new and emerging companies, the market doesn’t like this. And today’s environment is especially averse to companies operating at net losses.
Different markets are more receptive to the more risky, big potential stocks like WELL Health. Today, significantly higher interest rates have hit stock valuations and present a risk for stocks like WELL Health. Also, the sentiment has shifted to a more risk averse one, and this does not bode well for stocks like WELL Health.
But it’s okay, because we prefer stocks that are trading off of fundamentals.
Underlying fundamentals remain strong
Despite the current losses at WELL Health, its business is growing and very much in demand. Health care systems are benefiting tremendously from the digitization that WELL Health enables. For example, wait times are being reduced, virtual appointments bring convenience to the picture, and doctors’ time is being freed up to focus more on patient care.
These are just some of the more straightforward benefits that WELL Health brings. Beyond this, the company has launched WELL Longevity+ Program, which focuses on preventative health. This program uses advanced precision diagnostics and AI technologies for the early detection of serious health conditions.
Leveraging technology in these ways has the potential to drastically improve health outcomes.
Earnings will be WELL stock’s catalyst
If investors are as excited as I am about this disruptive and revolutionary business, it’s hard to tell by looking at WELL’s stock price action.
This is because trading in WELL stock has been very much a sentiment game. It reached its highs based on pretty big excitement, which I believe was warranted. However, the price did get ahead of itself, so it’s good that it’s come back down to reality. Because now we can focus on the fundamentals and value the stock off of fundamentals.
Looking ahead, we can expect WELL Health to approach $1 billion in revenue and profitability very soon. In fact, in 2024, revenue is expected to come in between $950 and $970 million. Also, analyst earnings estimates are rising quickly. In 2024, WELL Health is expected to post a net loss of $0.03 per share (up from the previous estimate of a loss of $0.10). Also, in 2025, WELL Health is expected to post EPS of $0.17 (up from $0.11), and in 2026 expectations are calling for EPS of $0.40 (up from $0.24).
In conclusion, for those investors who are willing and able to put up with the volatility, I would definitely say that WELL stock is a buy.
The post WELL Stock: Buy, Sell, or Hold? appeared first on The Motley Fool Canada.
Should you invest $1,000 in WELL Health Technologies right now?
Before you buy stock in WELL Health Technologies, consider this:
The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the 10 best stocks for investors to buy now… and WELL Health Technologies wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.
Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $15,578.55!*
Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 32 percentage points since 2013*.
See the 10 stocks * Returns as of 3/20/24
More reading
Can You Guess the 10 Most Popular Canadian Stocks? (If You Own Them, You Might Be Losing Out.)
How to Build a Bulletproof Monthly Passive-Income Portfolio in 2024 With Just $25,000
Fool contributor Karen Thomas has a position in WELL Health Technologies. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
2024
