Generational wealth doesn’t happen overnight. It is the result of years of planning, decision-making, and plain old patience. Investing for generational wealth involves the same process. We can start to build it today by buying the right stocks and exercising patience. Well Health Technologies Corp. (TSX: WELL) is just the overlooked stock to help you get started.
Let’s take a look at why Well Health is a good stock for your shot at creating generational wealth.
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What is Well Health?
Put simply, Well Health is a digital healthcare company that’s aiming to digitize and improve healthcare systems through technology, improving patient care and practitioner efficiency. The company operates in four segments:
The first is the Canadian clinics, which are the largest division by revenue, and is basically tech-enabled health care delivery. This includes the primary care, specialized care, and diagnostic imaging businesses. Next is WellStar, a pure-play SAAS and services company that focuses on technology to support care providers. Then we have HealWell AI, a pure-play data science and healthcare software company. And finally, Cyberwell, which is a pure play data protection and cybersecurity business.
How is Well Health performing?
For many years now, Well Health has been a fast-growing company that has been surpassing expectations. In fact, in the last five years, the company’s revenue has increased more than 1,700% to $920 million in 2024. This has been accompanied by sharp rises in profitability and cash flows.
Well Health’s most recent quarter was another record-setting one after many such quarters. Revenue came in at $356.7 million, 57% higher versus last year. Also, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 231% to $49.7 million. Finally, earnings per share (EPS) came in at $0.10 and free cash flow increased 34% to $11.7 million.
Canadian clinics
This segment is the largest one for Well Health. And it’s one that has significant long-term growth opportunities. At this time, Well Health is the market leader in this market, with a larger footprint than the next five participants combined. Yet, the company’s market share is still very small. In fact, it’s estimated to be below 2%.
Second quarter revenue for this division was $131 million, with EBITDA of $23 million. The growth rates were 40% and 76%, respectively. Acquisitions continue, with three having been completed in the quarter, and a very strong acquisition pipeline.
The long-term vision for this segment is big – annual revenue of $4.5 billion and EBITDA of $650 million. This would represent an eight to ten percent market share.
Why this overlooked stock is a buy
These historical results are reason enough as they signal strong, increasingly profitable growth. But this is complemented by a bright future that is expected to see continued acceleration in revenue and earnings.
Looking to the full year of 2025, management expects revenue of between $1.4 to $1.45 billion, for a 52% to 58% growth rate. Also, adjusted EBITDA is expected to come in between $190 million and $210 million, or roughly 25% higher versus last year.
These results do not assume any additional acquisitions, although they will surely happen, as the pipeline is strong.
The bottom line
Well Health Technologies stock trades at 20 times this year’s estimated earnings and 15 times next year’s estimated earnings. Earnings growth rates are expected to come in at 77% this year and 30% next year. There is upside to the numbers, as management has indicated that growth continues to surpass all expectations.
This is a story that has a long runway of growth, and Well Health is an overlooked stock that’s currently extremely attractively priced in my view.
