WELL Health Stock (TSE:WELL) Falls Despite Solid Q1 Earnings, Guidance Increase

Earlier today, WELL Health Technologies (TSE:WELL), a digital healthcare services provider, posted its Q1-2023 earnings results, beating revenue expectations and matching earnings-per-share (EPS) expectations. The company also raised its 2023 revenue guidance. Nonetheless, the stock is currently lower on the day.

Q1-2023 Results

In Q1 2023, WELL Health reported record revenue of C$169.4 million (vs. the C$159.8 million consensus estimate), a 34% year-over-year increase. This growth was primarily propelled by organic growth of 21%. Meanwhile, adjusted EPS came in at C$0.06 compared to the C$0.04 figure of Q1 2022. Also, WELL’s adjusted EBITDA rose to C$26.7 million, a 14% increase compared to Q1 2022.

Additionally, the company witnessed 1.4 million patient interactions in Q1-2023, indicating an annualized run rate of about 5.6 million, and its cash flow from operations reached C$17.62 million, growing by 31.5% year-over-year. However, its adjusted gross profit margin fell from 54.8% in Q1 2022 to 50.9%.

Updated 2023 Guidance

WELL increased its 2023 annual revenue guidance to be between C$690 million and C$710 million (21% to 25% growth). The previous estimate called for C$665 million to C$685 million in revenue. WELL Health also reaffirmed that its 2023 adjusted EBITDA will grow by more than 10% year-over-year.

Is WELL Health Stock a Buy, According to Analysts?

Analysts are unanimously bullish on WELL stock, as it has eight unanimous Buy ratings, making it a “Strong Buy.” The average WELL Health stock price target of C$8.12 implies about 60.2% upside potential.

If you’re wondering which analyst you should follow if you want to buy and sell WELL Health stock, the most profitable analyst covering the stock (on a one-year timeframe) is David Kwan of TD Securities, with an average return of 86.09% per rating and a 65% success rate. See below.

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