A sum of $1,000 in capital is a relatively small amount to purchase stocks but is good enough to start an investing journey. Note that the measure of financial success in the stock market is the return on investment (ROI). You would be surprised that the ROI could be 100% or more when you buy low and sell high or in a longer timeframe.
In the 2024 TSX30 List, a flagship program and annual rankings of the TSX’s top-performing growth stocks, Hammond Power Solutions ranked number one with 928%-plus growth (dividend-adjusted share price) in three years. If you buy the stock today, the share price is $145.61 (+79.3% year-to-date).
But assuming you only have $1,000 to invest, the ultimate stock to buy right now is Vitalhub (TSX:VHI). The small-cap stock in the healthcare sector is also a Top 30 winner this year, placing 26th. However, it outperforms Hammond Power Solutions year-to-date. At 8.41 per share, the outsized gain is 106.1% in only nine months.
Had you invested $1,000 at year-end 2023, your money would be $2,061.27 today. Given the growth trajectory (182.2%, and 41.2% compound annual growth rate) in three years, the healthcare stock could soon rank higher on the TSX30 List.
Business Overview
Vitalhub develops technology solutions for health and human services providers. Its clients are hospitals, regional health authorities and those in the mental health, long-term care (LTC), home health, and community and social services sectors. VHI, a TSXV graduate, started trading on the TSX in September 2021.
The $439.9 million Toronto-based software company offers a comprehensive suite of Software-as-a-Service solutions. The solutions include a) Electronic Health Record (EHR), Case Management, Care Coordination, and Optimization; b) Patient Flow, Operational Visibility, and Patient Journey Optimization; and c) Workforce Automation & Compliance.
Besides Canada and the U.S., Vitalhub is present in Australia, the United Kingdom, Western Asia, and internationally. Notably, the UK market is the largest revenue contributor. The recent strategic leadership appointment is part of the active consolidation program that aims to drive growth and operational excellence.
Vitalhub also expects to close or complete the acquisition of MedCurrent this month. According to VitalHub CEO Dan Matlow, acquiring the Clinical Decision Support (CDS) company is a significant step towards enhancing healthcare delivery through technology. “MedCurrent’s unique CDS software addresses a clear and critical need in the healthcare system,” he added.
Building on a strong foundation
In the first half of 2024, revenue and net income climbed 23% and 25% year-to-year to $31.5 million and $983,413, respectively. The gross margin in Q2 2024 was a robust 81%, while annual recurring revenue (ARR) grew 25% to $51.3 million from a year ago.
Matlow said the recent quarterly results reflect significant organic growth and strategic advancements. At the quarter’s end, the cash position reached $71.6 million. Matlow said it will enable Vitalhub to pursue organic growth and strategic acquisitions effectively. “We continue to build on our strong foundation,” Matlow assured.
Grow your wealth
Investing $1,000 in outperforming stocks is enough to grow wealth. Vitalhub is cheap right now but could be expensive or beyond reach if it continues to gain 100% every year.
