Insider buying at VitalHub (VHI) caught our attention this morning. The company provides healthcare software solutions to clients around the world including North America, the UK, Australia, Qatar, and Latvia. The company has its roots in the mental health and long-term and community care areas. VitalHub technology solutions include assisting in health records management, caseloads, and care coordination.
We last featured the stock here on September 3rd, 2020. Since that time, it has advanced 37.9%, underperforming the INK Canadian Insider Index (+63.5%) which enjoyed the benefit of oil & gas exposure, but outperforming the S&P/TSX Composite (+25.4%) and the TSX Healthcare Index (-4.2%). The company has been trading in Canada for just over 5 years and is relying on both organic growth and acquisitions to drive growth. When it reported Q3 results on November 15th, quarterly revenue was $6.6 million, up 107% from a year earlier. Vitalhub reported that annual recurring revenue grew by $1.8 million or 9% with just over half a million of that representing organic growth with the rest achieved via acquisition. Meanwhile, according to Refinitiv, on a trailing 12-months basis EPS remained negative compared to a year ago, but free cash flow per share improved to 1 cent from negative.
In our market update today, we discussed some worrying signs that the risk of a US recession is rising. If those fears continue to mount, Healthcare stocks could begin to attract more investor attention as a place to hide while the Fed tapers and talks rate hikes.