WELL Health will benefit from this huge trend in healthcare, analyst says

Stifel analyst Justin Keywood said Alberta’s new Bill 11 underscores a rapidly expanding private-pay sub-segment of Canadian healthcare—an area he estimates at roughly $500-million today (excluding drug coverage), growing more than 25% annually and likely to exceed $1-billion by 2030.

In a Dec. 3 report, he said the legislation clarifies how physicians can operate concurrently in public and private settings, a grey zone that has limited participation to a small number of providers despite strong demand, including at WELL Health’s (WELL Health Technologies Stock Quote, Chart, News, Analysts, Financials TSX:WELL) INLIV clinic.

Keywood noted that private medical services have become a meaningful outlet for system strain. Ontario’s Auditor General highlighted more than 108,000 people on a year-long physician wait list, reinforcing the structural pressures driving patients and employers toward premium diagnostic and longevity-focused offerings. Private clinics attract top specialists through higher billings and offer advanced diagnostics ranging from full-body MRI and genetic testing to cardiac stress assessments.

He said the majority of revenue increasingly comes through corporate benefits and private insurance, though aging demographics are expanding the out-of-pocket market.

WELL Health Technologies, headquartered in Vancouver, provides the most direct public-market exposure to this expansion. Its 227 Canadian clinics generate a run-rate of roughly $440-million in revenue and $60-million in EBITDA, supported by strong same-clinic organic growth. While WELL does not separately disclose private-clinic metrics, Keywood said discussions with clinic managers indicate EBITDA margins above 20%, higher than the consolidated patient services average of roughly 13.5%.

Several existing WELL sites could convert to hybrid or fully private models with modest capital investment, supported by a clear return-on-invested-capital rationale.

He emphasized WELL’s position as Canada’s leading consolidator of primary and specialty care with roughly 1.5% market share in a sector where only 2%–3% of clinics have been consolidated, compared with more than 50% in the U.S.

WELL continues to buy underperforming clinics operating at 0%–5% EBITDA margins and, through technology integration, shared overhead, and management improvements, including early AI-scribe adoption, typically lifts them to 10%–18% margins within 12 to 18 months. The company is also streamlining its portfolio, divesting U.S. assets and refocusing on a pure-play Canadian clinic and technology services roll-up.

Keywood said WELL offers a rare public vehicle to participate in the emerging two-tier Canadian healthcare structure. Bill 11’s passage and similar provincial pressures could accelerate hybrid care models. He modelled the potential impact of an “80/20” public-private revenue mix by 2030, where private visits bill at roughly four times public rates, or about $350 per encounter.

Under a public-only scenario, WELL’s Canadian clinics generate a five-year CAGR of roughly 16 per cent, doubling revenue by 2030. With a phased transition to an 80/20 model, the CAGR rises to 26%, tripling revenue over the same period. Administrative complexity from multiple payors may offset some expense benefits, he said, but the revenue uplift would be significant.

Keywood’s DCF values WELL’s Canadian clinic network at approximately $3.10 per share under a public-only structure and $4.30 under a hybrid structure. With WELL shares trading near $3.90 at the time of writing, he argues the Canadian business alone justifies the valuation, giving investors a “call option” on the U.S. operations.

Adoption of private-care models remains limited, and timelines may unfold more slowly than modelled, but he considers the policy shift a major catalyst to monitor as provincial governments search for capacity solutions.

He reiterated WELL as a preferred way to gain exposure to the accelerating private-care sub-TAM and the broader consolidation opportunity in Canadian healthcare.

Disclosure: WELL Health is an annual sponsor of Cantech and Nick Waddell owns shares of the company.

-30-