LifeMD: Dilution Ramps Up As Revenue Moves Higher

2025-02-01 06:26:59 ET

Summary

• LifeMD is trading at a low multiple to sales of 1.08x even as the telehealth company generates material revenue growth.
• The preferreds are trading a tighter discount to their $25 per share liquidation value. They now offer a roughly 10% yield on cost.
• Dilution is material and increased by 22% over its year-ago comp during the fiscal 2024 third quarter.

LifeMD ( LFMD ) is up roughly 3% over the last 1 year but is still now trading roughly 56% below its 52-week-high. The telehealth company is now trading at a $238 million enterprise value after its market cap is adjusted for net cash and cash equivalent s of $37.6 million as of the end of its fiscal 2024 third quarter. I've previously rated the company and its 8.875% Series A Cumulative Perpetual Preferred Shares ( LFMDP ) as a buy on the back of intense revenue growth, a healthy liquidity position, and an improving free cash flow profile. LFMD generated fiscal 2024 third-quarter revenue of $53.4 million , up a remarkable 38.3% over its year-ago comp, albeit missing consensus by $400,000....

Read the full article on Seeking Alpha

For further details see: