Earnings Alert! Is WELL Health Stock a Buy After Earnings?

Despite impressive performances, this Canadian telehealth stock is still battered. Is it a buy after its latest earnings report?

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Due to several factors, the Canadian stock market has been riddled with volatility in 2023. Amid the market volatility, share prices across the board have fallen. While a decline in share prices is warranted for many overpriced stocks, even some of the most high-quality stocks have suffered in the downturn.

One such stock is WELL Health Technologies (TSX:WELL). After releasing its latest quarterly earnings report, WELL Health stock saw a substantial jump in share prices.

Today, we will look closely at the stock and what has happened during its record-breaking quarter to help you determine whether it might be a good addition to your self-directed portfolio right now.

Record earnings

WELL Health Technologies is an $887.99 million market capitalization multichannel digital health technology company and Canada’s only company operating in the healthcare sector’s telehealth segment. November 14 saw WELL Health shares soar by 5% in early trading after the stock announced its promising earnings for the quarter.

Quarter by quarter, this has become the 19th consecutive quarter of record revenue growth for WELL Health stock. The company saw a 40.2% uptick in its revenue compared to last year, crossing the $204.5 million mark.

The company’s revenue from Canadian patient services climbed by 27% to hit $57.8 million. At the same time, its patient services revenue from U.S. operations saw a 52.3% increase to cross the $130 million mark.

The company continues to see its profitability rise. Its earnings before interest, taxes, depreciation, and amortization (EBITDA) also hit a record $28.2 million in the quarter. All these factors indicate that the company is not slowing down its growth in any way.

Foolish takeaway

WELL Health Technologies is not settling for satisfaction with its record-breaking quarterly performances. The company has several other business ventures in the pipeline for the current quarter and many more in the future.

The company recently acquired Seekintoo, a company that offers cybersecurity services to enterprise-level clients. The company is also investing in its artificial intelligence-based services and its HEALWELL service for further success in the near future.

As the end of the year draws closer, WELL Health stock looks well positioned to deliver further growth. Despite weakness in the broader economy, the company expects to put up strong results in the last quarter of fiscal 2023 and continue its run in 2024. As of this writing, WELL Health stock trades for $3.73 per share.

Down by 37.20% from its 52-week high, WELL Health stock trades at a considerable discount. Its discounted valuation comes at a time when the company is doing well, but the broader economy is not. While it is impossible to predict when it will happen, the stock market will go through a rebound.

When that time comes, WELL Health Technologies stock could be one of the top performers on the TSX in 2024. Investing in its shares at current levels can set you up for significant wealth growth.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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