We came across a bullish thesis on Viemed Healthcare, Inc. (VMD) on Substack by Petty Cash. In this article, we will summarize the bulls’ thesis on VMD. Viemed Healthcare, Inc. (VMD)’s share was trading at $7.25 as of March 27th. VMD’s trailing P/E was 25.89 according to Yahoo Finance.
A close-up of a medical technician wearing lab coat and a face mask preparing a portable oxygen concentrator for a patient.
Viemed Healthcare (VMD) reported solid quarterly results, surpassing expectations and driving a modest stock increase of 3-4%. Revenue reached $60.7 million, while EBITDA improved to $14.2 million from $12.8 million. Patient metrics remained strong, with ventilator patients growing 14% year-over-year and 4% sequentially to 11,795, while PAP therapy and sleep resupply patient counts saw impressive growth, rising 43% and 29% year-over-year, respectively. For the first time, VMD issued full-year guidance, projecting $254-265 million in revenue and $54-58 million in EBITDA, reflecting a 16% and 10% increase at the midpoint. Management noted typical seasonality, with Q1 softer than Q4 before ramping up.
The company continues its transition from a traditional home medical equipment (HME) provider to an in-home clinical care provider. While uncertain about the impact of tariffs and regulatory changes under the new administration, management remains confident in VMD’s positioning amid broader healthcare cost-efficiency trends. The joint venture with East Alabama Medical is progressing well, and larger JV opportunities may emerge. The M&A landscape has improved compared to previous years, offering potential expansion opportunities.
The market for VMD’s ventilation and sleep apnea treatments remains underpenetrated, presenting a significant runway for growth. COPD affects 25 million people in the U.S., with 1.25 million in chronic respiratory failure requiring ventilation, yet industry penetration remains in the high single digits. Similarly, sleep apnea remains widely underdiagnosed, and the rise of GLP-1 medications has increased patient awareness and demand for PAP therapy, driving recurring resupply revenue.
Despite strong execution and growth, VMD trades at a compelling 6x EV/EBITDA trailing and 5.5x forward, near its post-COVID lows. While the company requires capital for expansion, its organic growth, improving M&A environment, and undervaluation make it an attractive investment.
Viemed Healthcare, Inc. (VMD) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held VMD at the end of the fourth quarter which was 9 in the previous quarter. While we acknowledge the risk and potential of VMD as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than VMD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.