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Stockchase Insights
VitalHub Corp.
VHI-T
PARTIAL BUY
Jul 07, 2025
Stock price when the opinion was issued
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Still loves it, one of his largest positions, high quality, growing. All-time high today. Benefitting from rate-hike sentiment. Healthcare scheduling software. Excitement around raising money to make acquisitions, which have yet to come to pass. Very good acquirers. Still reasonable at around 20x.
VHI’s EBITDA margin has improved in recent quarters to 26% in Q2-2024 compared to last year’s 23%. EBITDA Margins have improved gradually due to a business model with highly favourable operational leverage, where most of the growth flows straight to the bottom line due to the limited capex required. The recent acquisition of Strata Health marks VHI’s largest acquisition ever. We have comments on the recent acquisition here.
VHI will fund the acquisition for a total up-front consideration of $32.3M through a combination of cash ($18.6M) and 1,480,726 shares. On the trailing twelve-month basis, Strata Health generated $12.7M in revenue and has an annual recurring revenue (ARR) of $12.3M, the deal is valued at 2.6x ARR. We think the deal is highly accretive to VHI as VHI itself is trading at around 10x ARR. We like the deal, we think VHI can continue to execute its acquisitive growth strategy in an efficient way going forward.
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Amazing job. Underlying metrics on profitability are incredible, but can it continue? If yes, will be a multi-compounder for years to come. As they keep delivering, so does confidence that they can keep doing so. Vast addressable market. Savvy management.
You have to watch carefully that numbers back up the story. Safe to accumulate.
Its software makes health care more efficient. It is in the U.K., Canada and Australia and growing rapidly with lots of upside in the U.K. With $100 000 cash and lots of upcoming acquisitions, its valuation should be cut in half once it starts deploying its capital. Should be a $20 stock a year from now.
Buy 7 Hold 0 Sell 0
A large position for him. They bring tech to the healthcare industry, like software. They had a previous business that they grew, then sold to private equity and finished their non-competes, and now they're doing that again with a new product that is starting to produce cash. Margins have risen to 24%, and they target 40%. It's becoming a cash engine that they're using to reinvest in products. They have a ton of cash as they grow 10-15% organically.
EPS of 1.6c missed estimates of 2.8c; revenue of $20.59M beat estimates of $19.42M. EBITDA of $5.0M beat estimates by 9%. Cash is $90M, and the CEO noted the four acquisitions last year and expects a continued strong M&A pace this year as well. Organic annual recurring revenue ARR rose 15%. Total organic growth was 5%, acquisition growth 27%. Gross margins 81%. Net income did fall year over year. But EBITDA rose 27%. Not a perfect quarter, but the ARR growth is good to see, and the company is certainly still in growth mode set-up overall. Consensus calls for at least 50% EPS growth this year.
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The acquisition of Novari is on the expensive side, but investors seem comfortable. VHI hopes to see it as a 'strategic' deal, which will expand it expand globally. Margins and other data were not provided, so we can only assume VHI believes in the future prospects here. Novari will add about 15% to VHI's annual revenue, pushing it above $100M. VHI also has a premium multiple so can justify the deal that way. We think it looks OK and would give management the benefit of the doubt here.
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