DOC stock has 300% upside, says Beacon

Following the company’s most recent results, Beacon Securities analyst Gabriel Leung remains bullish on CloudMD (CloudMD Stock Quote, Chart, News, Analysts, Financials TSXV:DOC).

On November 30, DOC reported its Q3, 2023 results. The company posted Adjusted EBITDA of $500,000 on revenue of $23.6-million, a topline that was up slightly from the $23.2-million the company recorded in the same period last year.

“Q3 was a strong quarter, which reflects our strategy in action, CEO Karen Adams said. “We have taken over $20 million in costs out of the business over the last year, resulting in achieving our goal of becoming Adjusted EBITDA positive one full quarter ahead of forecast. We generated double-digit organic revenue growth in the Health and Wellness division and plan to build on this momentum by continuing to expand our pipeline and increase client lifetime value through multi-product solutions that capitalize on the industry demand for comprehensive health solutions.”

“Overall, we view the Q3 results as another positive data point given the net new bookings, declining EBITDA burn,” Leung said. “We believe that new deal flow, and updates on the company’s large RPM win (which could drive ~$3 – 4M in quarterly revenues once fully deployed) represent key near-term catalysts.

In a research update to clients November 30, Leung maintained his “Speculative Buy” rating and price target of $0.50 on DOC, implying a return of 300 per cent.

Leung thinks DOC will post an Adjusted EBITDA loss of $1.9-million on revenue of $93.8-million in fiscal 2023. He expects those number will improve to Adjusted EBITDA of positive $3.8-million on a topline of $102.8-million the following year.