Looking at their growing revenue and P/S multiple, those numbers look quite good for a small cap. Is there a better metric for this particular company? What do you think is the biggest negative that investors see in this stock at the moment?
WELL still looks attractive from a valuation perspective right now. Forward price to sales has come down to 0.9x which is definitely good considering the high rate of revenue growth over the last few years as well as forecasted in 2024. Another metric we would look at is forward price-to-earnings which is also at attractive levels at 13.1x. While both metrics are key here, WELL has seen it's stock price fluctate recently due to investors sentiment related to margin issues. If WELL can deliver/exceed forward earnings estimates in 2024, then the stock is cheap and should do very well. While its last quarter's earnings and outlook were solid, margins declined a bit on a yearly basis and the stock took a hit. We would say the biggest negative investors see in the stock is if it can effectively impove margins and sustain profitability.