TFSA Picks: 1 Healthcare Value Stock with Significant Growth Opportunities

The extent of value-added services provided by Viemed Healthcare Inc. (TSX:VMD)(NASDAQ:VMD) should add significant intrinsic company value over the long-term.

| More on:

Viemed Healthcare (TSX:VMD)(NASDAQ:VMD) is a participating medicare durable medical equipment supplier that provides post-acute respiratory care services in the United States. The company operates through two wholly-owned subsidiaries, Sleep Management and Home Sleep.

Viemed’s primary objective is to solidify the company’s position as the largest independent leader in home therapy of patients suffering from respiratory diseases that require a high level of service. The company’s programs are designed specifically for payors to gain the ability to treat patients in the home for less total cost and with a superior quality of care.

Organic growth model

The services of the company’s subsidiaries include respiratory disease management, neuromuscular care, in-home sleep testing and sleep apnea treatment, oxygen therapy, and respiratory equipment rentals. Viemed adopts an organic growth model whereby expansion is effectuated through existing service areas as well as in new regions through a cost-efficient launch that reduces location expenses.

Viemed employs more respiratory therapists than any other independent provider in the United States. By focusing overhead costs to personnel that service the patient rather than physical location costs, Viemed anticipates efficiently scaling the company’s business in regions that are currently not being effectively serviced.

Significant growth opportunities

The continued trend of servicing patients in the home rather than in hospitals is aligned with Viemed’s vision, and management anticipates that it will continue to offer growth opportunities for Viemed. Viemed expects to continue to be a solution to the rising health costs in the United States by offering more cost-effective home based solutions while increasing the quality of life for patients fighting serious respiratory diseases.

Revenue from ventilator products represented approximately 87% and 92% of total revenues. Viemed’s management believes that the company’s subsidiaries are poised for organic growth moving forward. The company focuses on disease management and improving the quality of life for respiratory patients through clinical excellence, education and technology.

Variety of service offerings

Viemed’s service offerings are based on effective home treatment with respiratory care practitioners providing therapy and counseling to patients at homes using cutting-edge technology. The company’s home sleep division focuses on providing in-home sleep testing for sleep apnea sufferers.

Further, Viemed is one of the largest independent non-invasive ventilator provider in the United States with a service coverage area of 24 states in the United States and prospects to grow. The company’s respiratory disease management service aims at improving quality of life and reducing hospital re-admissions by using proven methodology and leading technologies such as counseling on proper diet, activity level, smoking cessation and inhaler use.

Value-added services

Viemed sources hardware from vendors and pairs them with industry leading respiratory therapy. The company’s neuromuscular care service is focused on helping neuromuscular patients to breathe more comfortably while living an active, healthier life, and uses respiratory therapy treatments which can lessen the effort required to breathe.

Also, the company’s oxygen therapy service provides the patient with extra oxygen, which is sometimes used to manage certain chronic health problems. Overall, the extent of value-added services provided by Viemed should add significant intrinsic company value over the long term.

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.

Fool contributor Nikhil Kumar has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Viemed Healthcare Inc.

More on Investing

Train cars pass over trestle bridge in the mountains
Dividend Stocks

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

Can CNR stock continue its long-term outperformance into 2025 and beyond? Let's explore whether now is a good time to…

Read more »

engineer at wind farm
Energy Stocks

Invest $20,000 in This Dividend Stock for $100 in Monthly Passive Income

This dividend stock has it all – a strong outlook, monthly income, and even more to consider buying today.

Read more »

Hourglass and stock price chart
Stock Market

It’s Not Too Late: Invest in These TSX Growth Stocks Now

Solid fundamentals of these top TSX growth stocks could help them maintain strong upward momentum in the years to come.

Read more »

coins jump into piggy bank
Dividend Stocks

The Smartest Dividend Stocks to Buy With $500 Right Now

These top dividend stocks both offer attractive yields and trade off their highs, making them two of the best to…

Read more »

stocks climbing green bull market
Stocks for Beginners

3 TSX Stocks Soaring Higher With No Signs of Slowing

Don't ignore stocks just because they look like they're at a high price. Instead, see exactly why they've driven so…

Read more »

dividends can compound over time
Bank Stocks

Is TD Bank Stock a Buy for Its 5.2% Dividend Yield?

TD Bank stock offers a rare 5.2% dividend yield—can it rebound from challenges and reward contrarian investors? Here's what to…

Read more »

chart reflected in eyeglass lenses
Investing

How Should a Beginner Invest in Stocks? Start With This Index Fund

This Vanguard index fund is the perfect way to start a Canadian investment portfolio.

Read more »

analyze data
Bank Stocks

Is BMO Stock a Buy for its 4.7% Dividend Yield?

Bank of Montreal is up 20% since late August. Are more gains on the way?

Read more »