VMD to Acquire Lehan’s Medical Equipment, Expanding Healthcare O

Viemed Healthcare (VMD, Financial) has announced its plans to acquire Lehan’s Medical Equipment, a company based in Illinois that specializes in home medical equipment, with a strong focus on respiratory care and women’s health. Lehan’s boasts an impressive track record, having operated for nearly eight decades and building a solid reputation for community involvement and expertise in women’s health.

According to CEO Casey Hoyt, this strategic move aligns with Viemed’s growth strategy by providing a robust platform in a rapidly expanding market while including familiar product lines. The acquisition not only enhances Viemed’s product mix by introducing maternal health offerings but also aims to bolster their existing relationships with payers nationwide. Hoyt expressed confidence in the highly skilled team at Lehan, noting their exceptional brand reputation and the value they bring to the partnership. This merger presents an opportunity for Viemed to strengthen its presence and expand its healthcare solutions.

Wall Street Analysts Forecast

Based on the one-year price targets offered by 3 analysts, the average target price for Viemed Healthcare Inc (VMD, Financial) is $12.83 with a high estimate of $15.00 and a low estimate of $11.00. The average target implies an
upside of 75.08%
from the current price of $7.33. More detailed estimate data can be found on the Viemed Healthcare Inc (VMD) Forecast page.

Based on the consensus recommendation from 3 brokerage firms, Viemed Healthcare Inc’s (VMD, Financial) average brokerage recommendation is currently 2.0, indicating “Outperform” status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.

Based on GuruFocus estimates, the estimated GF Value for Viemed Healthcare Inc (VMD, Financial) in one year is $12.29, suggesting a
upside
of 67.67% from the current price of $7.33. GF Value is GuruFocus’ estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business’ performance. More detailed data can be found on the Viemed Healthcare Inc (VMD) Summary page.

VMD Key Business Developments

Release Date: March 11, 2025

• Revenue Growth: 20% increase year-over-year for Q4; 23% increase for the full year 2024.
• Vent Revenue: 4.4% sequential increase in Q4; accounted for 55% of Q4 revenue and 56% for the year.
• Sleep Business Revenue: Increased to 17% of Q4 revenues; 43% increase in 2024 compared to 2023.
• Gross Margin: 59.5% for Q4; 59.4% for the year.
• Adjusted EBITDA: $14.2 million for Q4 (11% growth); $51.1 million for the year (19% growth).
• SG&A Expenses: 46% of revenue in Q4; 47% for the year, down from 47% a year ago.
• CapEx: Gross CapEx of $13.6 million for Q4; $37.8 million for the year.
• Free Cash Flow: $11.6 million in 2024; 5.2% of revenue.
• Cash on Hand: $17.5 million at year-end.
• 2025 Revenue Outlook: Projected net revenue of $254 million to $265 million, implying 16% growth over 2024.
• 2025 Adjusted EBITDA Outlook: Projected to be in the range of $54 million to $58 million, implying 10% growth over 2024.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Viemed Healthcare Inc (VMD, Financial) reported a record revenue performance with a 20% year-over-year increase for Q4 and a 23% increase for the full year 2024.
• The company experienced strong growth in its core Vent business, which accounted for 55% of Q4 revenue and 56% for the year.
• The sleep business saw a nearly 10% sequential increase in sleep therapy patients, contributing to a 43% increase in 2024 compared to 2023.
• Viemed Healthcare Inc (VMD) has a strong balance sheet with $55 million available on credit facilities and no net debt, providing significant financial flexibility.
• The company is projecting net revenue growth of 16% for 2025, with adjusted EBITDA expected to grow by 10%, indicating a positive outlook for the coming year.

Negative Points

• The adjusted EBITDA margin declined year-over-year and sequentially, primarily due to shifts in product and service mix.
• Free cash flow decreased to $11.6 million in 2024 from $21.7 million in 2023, impacted by increased cash taxes and Philips receivable adjustments.
• The staffing business, while strategically important, contributes less to gross margin and introduces variability in top-line results.
• CapEx increased significantly due to the vent exchange program and growth in vent patients, impacting net cash flow.
• The company faces uncertainty regarding potential impacts from the new administration’s healthcare policies and tariffs, which could affect operations.