Valued at a market cap of $1.2 billion, WELL Health (TSX:WELL) stock went public in April 2016 and has since returned over 4,300% to shareholders. Despite these outsized gains, the TSX stock is also down 47% from all-time highs after falling 30% in 2025.
Let’s see if you should add WELL stock to your equity portfolio right now.
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Is WELL Health stock a good buy right now?
WELL Health is a digital healthcare company operating in Canada, the U.S., and internationally. It provides omni-channel patient services across medical specialties like primary care, women’s health, and behavioural health, while developing and selling healthcare technology solutions, including electronic medical records, telehealth platforms, practice management, AI-powered virtual assistants, billing services, and cybersecurity solutions to medical clinics and practitioners.
WELL Health delivered record quarterly revenue of $294.1 million in the first quarter (Q1), marking a 32% increase year over year, while outlining an ambitious strategic shift to concentrate operations in Canada over the next two years.
The digital healthcare company achieved adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of $27.6 million, a 36% increase from the prior year.
Excluding Circle Medical deferred revenue adjustments, quarterly revenue would have reached $300.7 million, exceeding a $1.2 billion annual run rate, with adjusted EBITDA of $34.1 million.
CEO Hamed Shahbazi announced plans to divest all U.S. care delivery businesses, including CRH anesthesia services and provider staffing operations, to focus capital on expanding WELL’s Canadian clinical network.
It currently operates over 220 clinics representing approximately 1% of total clinics in Canada, with ambitions to reach a 10% market share, equivalent to a $5 billion annual business.
WELL’s Canadian operations demonstrated exceptional momentum with 32% year-over-year revenue growth to $120.6 million and 13.4% organic growth. The Canadian clinic network welcomed over 1,000 physicians and delivered 933,000 patient visits in Q1, up 30% from the prior year. Management expects Canadian adjusted EBITDA to grow over 25% in 2025, targeting $100 million annually within two years.
The company’s clinic acquisition strategy has proven highly successful, with historical cohorts showing substantial EBITDA improvements. Clinics acquired between 2018 and 2020 at 6.3 times EBITDA multiples have seen 73% EBITDA growth, reducing implied multiples to 3.6 times. WELL currently has eight signed letters of intent representing 10 clinics and $44 million in annual revenue.
Strategic subsidiary HEALWELL AI continues to generate exceptional returns, with WELL’s $28.9 million net investment now valued at $158.5 million, representing a 450% return. HEALWELL’s recent $100 million Orion Health acquisition will contribute approximately $120 million in revenue and positive EBITDA to WELL’s consolidated results starting in Q2.
WELLSTAR, WELL’s technology platform serving over 40% of Canadian healthcare providers, achieved 20% organic growth and 29% EBITDA margins. The company plans to spin out WELLSTAR as a public entity in late 2025 or early 2026 following a successful $50 million equity raise.
WELL reaffirmed 2025 guidance of $1.35-1.4 billion revenue and $140-160 million adjusted EBITDA, excluding potential acquisitions, while resuming its share-buyback program.
Is the TSX stock undervalued right now?
Analysts tracking WELL Health stock forecast revenue to rise from $919.7 million in 2024 to $1.81 billion in 2028. Comparatively, it is expected to end 2028 with a free cash flow of $177.5 million, compared to an outflow of $6.70 million in 2024.
If WELL stock is priced at 20 times forward FCF, which is reasonable, given its growth estimates, it could almost triple over the next three years. Analysts tracking the TSX stock expect it to gain over 56%, given consensus price targets.
