WELL Health Technologies Corp T.WELL

the short/bear case

[speedy99]

The risk with a board such as this is that it becomes an echo chamber simply reinforcing the beliefs that we already have.  Most of us on this board are long WELL and so become perplexed as to why anyone would want to sell the stock.  And so when this occurs, in the absence of any articulated reason for it, we revert to theories of stock manipulation and improper conduct, etc.  Those theories are possible.  However, in the end if there is a robust demand and a belief in the future of the company by stock purchasers, none of that will matter.  And if you believe in the future of WELL none of those games should matter.  Maybe such games were played with Amazon's stock 5 and 10 years ago, but if you had an accurate view of the company's future, none of that would have mattered.   I do look to the market for indiations that something may be amiss, but that indicator is only a starting point.  I do not have the assumption, as do some here, that the market is always right.

There are certainly some reasons why someone would think to go short on WELL.  Unfortunately, the short faction on this board is comprised of immature morons who struggle putting a sentence together and who throw out personalized insults to the fictitous names who support WELL.   It is always good to know the short case for the stock you are invested in.  In the absence of any intelligent articulation of that case on this board I offer my own thoughts (keeping in mind that I am long WELL, overweight WELL, and have never sold a single share of WELL, and do not intend to)

1.  The price/earnings measure for WELL is non-existent.  It has no earnings.  Its earnings are negative.  On a per share basis its earnings are negative.  And the results of 3rd quarter indicaste earnings loss per share are expanding.  (Projections for earnings per share prior to 3rd quarter release were ZERO, so we had a miss on that measure.

2.   With fears of inflation, growth stocks with a promise of future profitability are not in vogue as it is assumed that the value of future profits is going to be eroded by inflation.

3.   The tele-health sector of which we are a part, is down an average of 30 per cent from its peak last year and continues to struggle.  Why invest in a company which is part of a beaten up sector which had high stock prices during a pandemic which is now receding?

4.   We are a conglomerate and conglomerates have been out of favour for the past 30 years.  Witness the recent break up of General Electric and other large corporations with a conglomerate structure.  Investors want to maximize value in their investments and value is often obscured in a conglomerate.  Our CEO acknowledged that certain parts of WELL may need to be spun off to have their values realized.  We are in the early stages of a rapidly growing, geographically diverse and multifacted sprawling organization and there are no assurances that everything can be successfully managed through a central office, and there is precious little evidence of the promised "synergies" amongst the various components.

5.   Time is money, and while we continue to keep our money invested in a sector which is beaten up and with few signs of a turnaround in the immediate future, we are missing opportunities in sectors which are in fact thriving, ie. the so called "re-opening trade".

These are a few that come to mind, and no doubt there are others.  I do not at this time need to articulate why I am not persuaded by these factors, given my previous articulations of support for this company.  My enthusiasm has not waned and I thought the figures on the 3rd quarter were awesome.

[monty613]

good write up, speedy99. just a comment on point #1 - the P/E of WELL has zero bearing here and every single investor knows this. WELL's negative net income includes non-cash expenses (Dep/Amort) and one-time expenses (ex - Acquisition Costs that aren't recurring).  if you look at their reconciliation of Adjusted EBITDA you can decide which add-backs are appropriate (one-time items,

[BudFoxx2020]

Very nicely put speedy.  I said the same thing but just not as articulate as your post.  Lol.  This is why I love this board aside from clown like onlyoil this is a great board.  One thing I will add is always stick to your discipline in the markets.  It will save you many headaches.  I have not given up on Well but the timing is just not there at the moment.  

[BudFoxx2020]

Teledoc down 9+%. Yikes.....  Well has had strong support for quite a while compared to Tdoc.  Well share price losses are not even close to what Tdoc have lost.  But once that support is gone just watch out.  Anyways my point is be diligent, don't fall in love and stick with your discipline.  Cheers.

[butchtennis]

IMO... this stock is being manipulated by the big boys...fund managers... shaking the tree in order to pick up cheap shares from the retail investors.

[HotDiggityDogg]

While I agree that there are elements of manipulation in this stock, no one can deny the lack of interets out there. The reason why it is being pushed down is becuase there is not enough buyers to push it up. I think the expectation of NASDAQ listing and possible dilution associated with the listing (true or not) started a chain reaction and created huge headwind.  Most trendy retail has

[monty613]

there's an open NCIB running until May 2022 but they have yet to use it - doesn't make sense to plow cash into that, even with a low share price https://www.newswire.ca/news-releases/well-health-announces-approval-of-normal-course-issuer-bid-885299113.html

[HotDiggityDogg]

I know that there is an open NCIB running, and I understand that there may be better use for funds but perhaps use of such a tool in the short term to stop the panic from shareholders could make sense. Just about EVERYONE knows about the porportion of Shorts vs. total trades are abnormally large for WELL. In such cases, either institutional buyers push back at these shorters or only other option

[BudFoxx2020]

Great post.  I am a big believer that the markets are always right.  If there are more buyers than the sellers, the share price will always go up no matter what.  Simple suppy and demand economics.  I honestly hate hearing nonsense about stock manipulation, shorts, etc.   The hype for the telehealth sector is gone.  And, HotDD, you just explained exactly what