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U.S. Healthtech Industry Analysis

UpdatedAug 17, 2022
DataAggregated Company Financials
Companies71
  • 7D0.8%
  • 3M19.3%
  • 1Y-42.8%
  • YTD-39.1%

The Healthtech is pretty flat in the last 7 days, but Veeva Systems has stood out, gaining 3.4%. As for the longer term, the industry has declined 43% in the last year. Earnings are forecast to grow by 40% annually.

Industry Valuation and Performance

Has the U.S. Healthtech Industry valuation changed over the past few years?

DateMarket CapRevenueEarningsPEAbsolute PEPS
Wed, 17 Aug 2022US$89.5bUS$17.0b-US$10,440,030,813.0036.6x-8.6x5.3x
Fri, 15 Jul 2022US$89.6bUS$17.4b-US$8,004,455,621.0058.4x-11.2x5.1x
Sun, 12 Jun 2022US$113.1bUS$23.2b-US$7,415,282,621.0048.2x-15.3x4.9x
Tue, 10 May 2022US$115.4bUS$23.9b-US$7,203,881,919.0057x-16x4.8x
Thu, 07 Apr 2022US$140.2bUS$23.4b-US$645,602,428.0074.9x-217.2x6x
Sat, 05 Mar 2022US$134.9bUS$23.6b-US$572,796,262.0078.4x-235.5x5.7x
Mon, 31 Jan 2022US$147.5bUS$23.7b-US$1,724,466,532.0094.5x-85.5x6.2x
Wed, 29 Dec 2021US$169.4bUS$23.3b-US$1,605,286,566.00102.2x-105.5x7.3x
Fri, 26 Nov 2021US$177.0bUS$23.0b-US$1,126,772,240.00105.2x-157.1x7.7x
Sun, 24 Oct 2021US$196.5bUS$22.1b-US$1,254,921,150.0091.3x-156.6x8.9x
Tue, 21 Sep 2021US$204.0bUS$22.0b-US$1,255,851,452.00107.5x-162.5x9.3x
Thu, 19 Aug 2021US$183.1bUS$21.9b-US$1,229,889,348.3190.1x-148.9x8.4x
Thu, 03 Jun 2021US$165.1bUS$20.3b-US$1,350,712,571.3190x-122.2x8.1x
Sun, 07 Mar 2021US$178.3bUS$19.1b-US$2,268,547,711.3182x-78.6x9.3x
Wed, 09 Dec 2020US$156.4bUS$17.5b-US$1,421,801,372.31114.4x-110x8.9x
Tue, 01 Sep 2020US$113.4bUS$14.9b-US$1,221,637,016.3143.5x-92.8x7.6x
Fri, 05 Jun 2020US$94.7bUS$14.2b-US$1,262,828,818.3143.5x-75x6.7x
Mon, 09 Mar 2020US$76.4bUS$13.7b-US$340,557,575.3154.8x-224.3x5.6x
Sun, 01 Dec 2019US$72.1bUS$13.4b-US$260,928,522.3153.2x-276.3x5.4x
Wed, 04 Sep 2019US$70.4bUS$13.1b-US$84,708,776.3152.7x-831.2x5.4x
Price to Earnings Ratio

-831.2x


Total Market Cap: US$70.4bTotal Earnings: -US$84,708,776.31Total Revenue: US$13.1bTotal Market Cap vs Earnings and Revenue0%0%0%
U.S. Healthtech Industry Price to Earnings3Y Average -145.4x202020212022
Current Industry PE
  • Investors are pessimistic on the American Healthcare Services industry, indicating that they anticipate long term growth rates will be lower than they have historically.
  • The 3-year average PS ratio of 7.0x is higher than the industry's current PS ratio of 5.3x.
Past Earnings Growth
  • The earnings for companies in the Healthcare Services industry have deteriorated over the last three years.
  • Meanwhile revenues for these companies have grown 9.2% per year.
  • This means that although more sales are being generated, either the cost of doing business or the level of investment back into businesses has increased, which has caused losses to expand.

Industry Trends

Which industries have driven the changes within the U.S. Healthcare industry?

US Market4.53%
Healthcare2.00%
Healthtech0.76%
Healthtech0.76%
Industry PE
  • Investors are most optimistic about the Healthtech industry even though it's trading below its 3-year average PE ratio of 71.3x.
  • Analysts are expecting annual earnings growth of 40%, which is higher than its past year's earnings growth of 2.8% per year.
Forecasted Growth
  • Analysts are most optimistic on the Healthtech industry, expecting annual earnings growth of 40% over the next 5 years.
  • This is better than its past earnings growth rate of 2.8% per year.

    Top Stock Gainers and Losers

    Which companies have driven the market over the last 7 days?

    CompanyLast Price7D1YValuation
    NUTX Nutex HealthUS$4.157.5%
    +US$187.7m
    n/aPE17x
    CHNG Change HealthcareUS$24.881.1%
    +US$88.6m
    17.1%PS2.3x
    FORA ForianUS$4.336.7%
    +US$9.1m
    -56.2%PS5.9x
    NXGN NextGen HealthcareUS$17.400.6%
    +US$6.8m
    14.8%PS2x
    CNVY Convey Health Solutions HoldingsUS$10.510.7%
    +US$5.4m
    13.9%PS2.1x
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    Latest News

    CERT

    US$16.66

    Certara

    7D

    -18.2%

    1Y

    -41.3%

    MPLN

    US$3.83

    MultiPlan

    7D

    -13.3%

    1Y

    -36.2%

    FORA

    US$4.33

    Forian

    7D

    6.7%

    1Y

    -56.2%

    DOCS

    US$34.93

    Doximity

    7D

    -12.5%

    1Y

    -55.8%
    Aug 11

    Doximity Appears Well-Positioned But Shares May Be Fully Valued Here

    Doximity went public in June 2021, raising approximately $606 million in gross proceeds in a U.S. IPO. The firm operates a digital collaboration and communication platform for physicians in the United States. Doximity has grown revenue and produces impressive free cash flow and earnings. But Doximity's shares may be fully valued at their current level, so I'm Neutral on DOCS in the near term. A Quick Take On Doximity Doximity, Inc. (DOCS) went public in June 2021, raising approximately $606 million in gross proceeds to the company and a selling shareholder from an IPO that priced at $26.00 per share. The firm operates a digital platform for medical professionals in the U.S., providing them with collaboration tools, telehealth solutions and related capabilities. Doximity appears well-positioned for a "new normal" of hybrid work environment for physicians, but I'm not convinced the shares are a good value here. I'm on Hold for DOCS in the near-term. Doximity Overview San Francisco, California-based Doximity was founded to help physicians to be more productive by providing them with information and tools for their practice. Management is headed by co-founder and CEO Jeffrey Tangney, who was previously co-founder of Epocrates, a mobile medical reference app company. The company's primary offerings include: Physician Communication Network Marketing Solution Hiring Solution Telehealth Solution Doximity/Enterprise Dialer The firm pursues a "land and expand" strategy to grow its business with each physician practice and health system. DOCS launched its Telehealth Solution in 2020 and said it delivered more than 63 million telehealth visits in FYE 2021. Doximity's Market & Competition According to a 2022 market research report by Grand View Research, the market for telehealth solutions and services was an estimated $62.4 billion in 2021 and is forecast to reach $551 billion by 2028. This represents a forecast CAGR of a very high 36.5% from 2022 to 2028. The main drivers for this expected growth are a growing penetration of internet broadband and increasing adoption by healthcare providers in the use of telehealth solutions for certain aspects of their service delivery options. Also, below is a chart showing the historical and projected future growth trajectory of the U.S. telehealth market: U.S. Telehealth Market (Grand View Research) Major competitive or other industry participants include: Teladoc PointClickClare Technologies Doctor Anywhere Cerner American Well Doctor on Demand GlobalMed MDLive Others Doximity's Recent Financial Performance Total revenue by quarter has grown but more recently dropped somewhat: 5 Quarter Total Revenue (Seeking Alpha) Gross profit by quarter has followed a similar trajectory to that of total revenue: 5 Quarter Gross Profit (Seeking Alpha) Selling, G&A expenses as a percentage of total revenue by quarter have been creeping up in recent quarters: 5 Quarter SG&A % Of Revenue (Seeking Alpha) Operating income by quarter has dropped materially in the past two quarters: 5 Quarter Operating Income (Seeking Alpha) Earnings per share (Diluted) have also dropped in line with operating income: 5 Quarter Earnings Per Share (Seeking Alpha) (All data in above charts is GAAP) In the past 12 months, DOCS' stock price has fallen 22.7% vs. the U.S. S&P 500 index' drop of around 4.7%, as the chart below indicates: 52 Week Stock Price (Seeking Alpha) Valuation And Other Metrics For Doximity Below is a table of relevant capitalization and valuation figures for the company: Measure [TTM] Amount Enterprise Value $6,960,000,000 Market Capitalization $7,730,000,000 Enterprise Value / Sales 19.26 Revenue Growth Rate 48.7% Operating Cash Flow $138,150,000 Earnings Per Share (Fully Diluted) $0.68 Net Income Margin 41.7% (Source - Seeking Alpha) Below is an estimated DCF (Discounted Cash Flow) analysis of the firm's projected growth and earnings: DOCS DCF (GuruFocus) Assuming generous DCF parameters, the firm's shares would be valued at approximately $33.45 versus the current price of $41.21, indicating they are potentially currently overvalued, with the given earnings, growth and discount rate assumptions of the DCF. The Rule of 40 is a software industry rule of thumb that says that as long as the combined revenue growth rate and EBITDA percentage rate equal or exceed 40%, the firm is on an acceptable growth/EBITDA trajectory. DOCS' most recent GAAP Rule of 40 calculation was 80% as of FQ1 2022, so the firm has performed quite well in this regard, per the table below: Rule of 40 - GAAP Calculation Recent Rev. Growth % 49% GAAP EBITDA % 31% Total 80% (Source - Seeking Alpha) Commentary On Doximity In its last earnings call (Source - Seeking Alpha), covering FQ1 2023's results, management highlighted beating its revenue and EBITDA guidance along with record high physician engagement. However, management also said its upsell rate for its pharmaceuticals clients slowed due to greater discretion by clients that can result in budget reductions. In response, CEO Jeff Tangney said he is shifting his focus from the firm's EHR integration efforts to its pharmaceutical products and partnerships, as he views the pharma market downshift as temporary in nature. The firm believes that its platform is well-positioned for the new 'hybrid' work model, which applies to physicians as their follow-up with patients can be from their office or home, so is increasingly virtual.