3 Top Telehealth Stocks to Buy Now

The current pandemic is leading to rapid adoption of virtual medicine. Investors should consider adding these three telehealth stocks for outsized growth.

| More on:

The healthcare sector has been notoriously slow to embrace technology solutions. This is not surprising, as it is primarily reliant on government funding, which comes with considerable red tape. However, the pandemic is forcing the industry to adapt, and business models are changing. Case in point, telehealth and virtual medicine is seeing unprecedented adoption.

After years of dragging their feet, physicians are now adopting this new way of delivering care. So too are governments worldwide. As an example, the Ontario provincial government pushed through billing codes for virtual visits in a matter of weeks after years of inactivity. 

How can investors take advantage? Here are three emerging telehealth leaders. 

One of the fastest-growing stocks

One of the top TSX Venture companies in 2018 and 2019, WELL Health Technologies (TSX:WELL) graduated to the TSX Index in the fall of 2019. WELL is a leading electronic medical records company that also owns and operates a series of medical clinics. 

Over the past year, the company has been a leading industry consolidator, and as a result has become the third-largest EMR provider in Canada and the largest OSCAR service provider in the country. 

Earlier this year, it launched VirtualClinic+, a virtual care platform that enables physicians to add telehealth consultations via phone or video. It is an industry that is booming, and VirtualClinic+ is seeing rapid adoption. .

The company’s performance has been nothing short of staggering. Over the past three years, it has doubled a number of times, returning a total of 1,974% over this period. It has already doubled again in 2020. 

A new addition to the TSX Venture

CloudMD Software & Services (TSXV:DOC) has a business model that is very similar to that of WELL Health Technologies. In early June, it graduated from the Canadian Stock Exchange to the TSX Venture and is sitting on gains of 80% thus far in 2020. 

The company has a head start on delivering telehealth options for physicians and is an industry pioneer. Its CloudMD virtual medicine flagship product has over 100,000 users on the platform. 

CloudMD is also on the approved lender list of some of Canada’s largest medical health care associations. Some notable examples include Doctors of BC, Ontario MD and the Canadian Association of Occupational Therapists. 

Furthermore, it has aggressive plans to expand in the United States. In May, it signed a deal with IDYA4 which will resell CloudMD’s technology south of the border. Through 2022, the company expects to generate $57 million in revenue, up from $11.5 million in 2019. This represents a compound annual growth rate of 70%. 

An underappreciated telehealth asset

You might be surprised to know that Telus (TSX:T)(NYSE:TU) is one of the largest telehealth providers in the country. Telus HEALTH has a suite of software solutions available to pharmacies, physicians, allied health professionals, hospitals and patients. 

In mid-2019, Telus HEALTH acquired Akira, an on-demand virtual care solution available to patients nationwide. Akira subscriptions have risen by approximately 80% since the start of the pandemic.

Although the company does not break out Telus HEALTH financials, analysts believe the unit brings in approximately $800 million in annual revenue. At the moment, Telus HEALTH is buried, and the company is likely not extracting full value for these assets. 

Given this, it’s possible that Telus spins out the telehealth unit much like it is doing with the International segment later this year. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

More on Tech Stocks

A data center engineer works on a laptop at a server farm.
Tech Stocks

3 No-Brainer Data Centre Stocks to Buy With $500 Right Now

Data centres are going to be a huge growth opportunity in the next decade. And these are the top buys.

Read more »

The virtual button with the letters AI in a circle hovering above a keyboard, about to be clicked by a cursor.
Tech Stocks

Is OpenText Stock a Buy, Sell, or Hold for 2025?

OpenText stock has fallen in the last few years, but that could mean this top tech stock remains an undervalued…

Read more »

AI microchip
Tech Stocks

Celestica Stock: Buy, Sell, or Hold?

Celestica's stock price has rallied 950% in the last five years. Will the AI boom send it even higher in…

Read more »

data analyze research
Tech Stocks

2 Ridiculously Cheap Growth Stocks to Buy Hand Over Fist in 2024

Well Health Technologies is a cheap growth stock to buy for its record-breaking results, massive revenue growth, and profitability.

Read more »

A worker uses a double monitor computer screen in an office.
Tech Stocks

4 Reasons to Buy Kinaxis Stock Like There’s No Tomorrow

Kinaxis stock has a strong past. But there is even more to look forward to from this top tech stock.

Read more »

The letters AI glowing on a circuit board processor.
Tech Stocks

The Future of AI: Best Canadian Stocks to Buy Now

Here are two of the best AI-focused stocks in Canada that you can consider adding to your portfolio before it’s…

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Tech Stocks

2 TFSA Stocks to Buy Right Now With $7,000

Are you looking for growth stocks that can help you maximize the tax-free withdrawals of the TFSA? This article is…

Read more »

cloud computing
Tech Stocks

3 No-Brainer Tech Stocks to Buy Right Now for Less Than $1,000

Not all tech stocks are the risky investments that many think they are. Which is why we're focusing on the…

Read more »