Needham has maintained a Hold rating on shares of American Well Corp. (NYSE: AMWL) following the company's update call on their Department of Defense Health Agency (DHA) contract implementation.
During the call, which included a demonstration, slide show, and Q&A session, American Well Corp. provided insights into this evolving business segment. The update highlighted that following the second quarter earnings call, Behavioral Health went live at five initial sites. Additionally, the company has since deployed its Converge platform at these locations and has begun rolling out Automated Care.
The progress puts American Well on track for completion and enterprise deployment in the fourth quarter of 2024, which is in line with previous projections.
In other recent news, Boston-based American Well Corp has reported a favorable second-quarter 2024 revenue of $63 million, surpassing consensus estimates.
The company's adjusted EBITDA loss of $35 million outperformed the projected $40 million loss. Analyst firm TD Cowen responded to these results by raising the price target for American Well to $12.00, up from the previous $2.00, while maintaining a Hold rating.
Furthermore, American Well has confirmed its revenue outlook for 2024 and improved its adjusted EBITDA forecast by $10 million, citing effective cost management strategies. The company is making strides with expansions and renewals, reflecting customer satisfaction with its Converge platform.
In the realm of company news, American Well has amended the employment agreement with Kathy Weiler, the Chief Commercial & Growth Officer, entitling her to a range of benefits should she leave her position without a "Good Reason" on or after June 1, 2025. Additionally, the company received initial positive feedback from the Defense Health Agency (DHA), and the deployment of its services remains on track.
Lastly, leadership changes have taken place with Co-founder Roy Schoenberg transitioning to Executive Vice Chairman of the company's Board of Directors, and Ido Schoenberg assuming the role of sole Chief Executive Officer.
InvestingPro Insights
As American Well Corp. (NYSE:AMWL) continues to make headway with its Department of Defense Health Agency contract and the deployment of its Converge platform, investors are closely monitoring the company's financial health and stock performance. According to InvestingPro data, AMWL has a market capitalization of approximately $152.16 million and has experienced a significant 3-month price total return of 25.31%, indicating strong recent market performance.
Notably, InvestingPro Tips reveal that American Well holds more cash than debt on its balance sheet, which is a positive sign for financial stability. Moreover, three analysts have revised their earnings projections upwards for the upcoming period, reflecting optimism in the company's future performance. However, it's worth noting that the company has been quickly burning through cash and analysts do not anticipate profitability this year. On the InvestingPro platform, there are 10 additional InvestingPro Tips available that could further guide investors in their decision-making process.
These insights, especially the positive stock return over the last three months and the upward earnings revisions by analysts, could be crucial for investors considering the company's prospects ahead of the detailed financial outlook expected in February. With a backdrop of cautious optimism from analysts, these data points offer a more nuanced view of American Well's current financial trajectory.
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