Many dirt-cheap stocks are often overlooked or assumed to be highly volatile. However, the fundamental concept of stock investing is you buy low and sell high to make money. One growth stock experiencing brisk volume yet still absurdly cheap is Healwell AI (TSX:AIDX).
At only $1.35 per share, the healthcare stock is up 80% year-to-date and has delivered a 140.4% return in one year. Had you invested $6,500 a year ago, your money would be $15,625.00 today. Based on market analysts’ 12-month price targets, the upside is between 189.6% (average) and 270.4% (high). These analysts’ bullish sentiment stems from the business’s visible growth potential.
I agree with the forecasts because there are three compelling reasons to buy the TSX stock right now. The company name (heal and AI) should already give you a clue.
Image source: Getty Images
1. Game changer
There’s the fixation of markets and investors on artificial intelligence, and blanket adoption of AI could be on the horizon. They say this next-gen technology is more efficient and can make life easier. For businesses, it would deliver profits with proper applications.
AI is a game-changer in the healthcare sector, and Healwell AI will be at the front and center as it happens. The $222.3 million healthcare technology company boasts a platform it believes can revolutionize healthcare through AI-driven preventive care. Management’s vision is to transform healthcare through innovation and technology.
Thus far, the stock’s growth trajectory has been remarkable despite high interest rates and an inflationary environment. Formed in partnership with WELL Health Technologies, Canada’s largest clinic owner and operator, Healwell AI will focus on AI and data science for preventative care.
2. Partnerships and strategic acquisitions
Healwell will leverage AI to accelerate preventive healthcare. The main intention is early identification and detection of diseases. Health practitioners can improve patient care for better patient outcomes. Its CEO, Dr. Alexander Dobranowski, has over 15 years of specialized clinical and healthcare technology experience. He will lead the team in advancing Healwell’s proprietary clinical decision support systems.
Building partnerships and pursuing strategic acquisitions for expansion and business growth are ongoing concerns. BioPharma Services, one of Healwell’s subsidiaries, is expanding into late-stage patient trials by integrating Canadian Phase Onward. The latter is a dedicated clinical research site.
Another subsidiary, Intrahealth, partnered with WELL Health subsidiary, OceanMD, to integrate OceanMD’s leading eReferral system across Intrahealth’s global network. The collaboration aims to enhance digital interoperability, streamline healthcare processes, and improve patient access to care.
3. Improving financial performance
The Q2 2024 results indicate improving financials and a healthy balance sheet. In the three months ending June 30, 2024, the revenue from continuing operations rose 205% year-over-year to a record $5.4 million. Net income reached $2.5 million compared to the $9.8 million net loss in Q2 2023 following a significant reduction in liabilities.
According to management, the annual revenue run-rate has already exceeded $65 million, and Healwell hopes to hit $100 million by year-end. The target is achievable given the robust M&A pipeline and strong cash balance support.
Long-term success
The future of Healwell AI is promising as the adoption of its platform continues to grow. Dr. Dobranowski is confident that the expanding market presence and enhanced financial stability will pave the way for long-term success.
