The company reports that there is a huge untapped market with 2.5 million in the US suffering from stage-4 COPD. However, home monitoring services as a subset of that industry is still a relatively new development. The entire durable medical equipment market is huge with a total market size of $58.3 billion. In terms of competition, Viemed is one of the top 3 providers of home ventilator rentals with about 10% market share. Since the introduction of modern highly sophisticated home ventilators within the last decade, non-invasive ventilators has become the gold standard for treating patients in the late stages of COPD It is time for both medical practice and health insurers, including Medicare, to catch up with changes in technology. “Using a non-invasive ventilator at home coupled with a high-touch home care model saves lives, saves money, and keeps patients out of the hospital. The evidence is clear,” said VieMed’s CEO Casey Hoyt. In the past 5 years, the company has expanded its services and grew revenue at a CAGR of 16.4%. Given the rising health care costs in the US, Viemed’s value proposition should allow it to grow revenues at a healthy rate. These initiatives should drive down costs and increase adoption in the long run. Viemed has been leaning on its technology initiatives to make its operations easier and more transparent. This is especially true now due to the coronavirus pandemic when people are afraid of going to hospitals for fear of catching the disease. This trend doesn’t necessarily require structural changes but can be accomplished with technology and a change in thinking. There is an existing trend for wanting care closer to home. This has certain advantages over traditional hospital care such as they are more convenient for the patient and are cheaper overall. Viemed focuses on being able to treat patients at their homes as opposed to hospitals, for their respiratory issues. The company ended the quarter with a cash balance of $29.7 million against long-term debt of $8.3 million. While the company is continuing to pursue sales opportunities related to COVID (by sourcing equipment and PPE), I believe that these are short-term in nature. The company booked $22.2 million in revenue from those sales representing nearly half of total revenue. In terms of Q2 2020 results, Viemed had a spectacular quarter due to the one-time bump from product sales of ventilators due to the coronavirus pandemic. The company currently operates in 35 states and is expanding its services in those areas. Viemed’s programs are administered by licensed respiratory therapists ensuring top-level care is given to patients. The majority of the company’s revenues though come from ventilator rental at 92% and 94% of revenue in 20 respectively. As part of its ventilator rental programs, the company provides a wide array of services such as respiratory disease management, neuromuscular care, Oxygen therapy, and sleep apnea management, and other in-home testing. Just a brief background on the company, Viemed is a medical equipment supplier that provides home therapy for patients with respiratory diseases. After doing some due diligence, I believe it is worth a look. One such company that piqued my interest is Viemed ( NASDAQ: VMD). I've been researching smaller companies to add to my portfolio as a way for investors to get better returns.
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