Piper Sandler has revised its target price for Amwell (AMWL, Financial), reducing it from $10 to $8, while maintaining a Neutral stance on the shares. This adjustment follows the company's positive first-quarter performance, where it surpassed revenue and adjusted EBITDA expectations, and reiterated its outlook for 2025.
Amwell achieved a significant milestone in early April with scheduled visits going live across the entire Defense Health Agency (DHA), accomplished both on time and within budget. Patient and provider satisfaction levels at the DHA have exceeded 90%. However, due to an ongoing leadership transition within the DHA, the deployment of automated programs and digital behavioral health services expected in the second quarter is anticipated to be postponed until the third quarter.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 8 analysts, the average target price for American Well Corp (AMWL, Financial) is $10.62 with a high estimate of $15.00 and a low estimate of $7.50. The average target implies an upside of 43.58% from the current price of $7.40. More detailed estimate data can be found on the American Well Corp (AMWL) Forecast page.
Based on the consensus recommendation from 10 brokerage firms, American Well Corp's (AMWL, Financial) average brokerage recommendation is currently 2.9, indicating "Hold" 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 American Well Corp (AMWL, Financial) in one year is $21.13, suggesting a upside of 185.54% from the current price of $7.4. 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 American Well Corp (AMWL) Summary page.
AMWL Key Business Developments
Release Date: May 01, 2025
- Total Revenue: $66.8 million for Q1, a 12% increase from Q1 2024.
- Subscription Software Revenue: $32.2 million in Q1, up 30% year-over-year.
- Gross Margin: 52.8% in Q1, an increase of 4.3 percentage points from Q4.
- Adjusted EBITDA: Negative $12.2 million, improved from negative $45.6 million in Q1 2024.
- Cash and Marketable Securities: $222 million at the end of Q1, with zero debt.
- R&D Expenses: $22.1 million, a 17% decrease from Q1 2024.
- Sales and Marketing Expenses: $12.6 million, 51% lower than Q1 2024.
- G&A Expenses: $23.2 million, 29% lower than Q1 2024.
- Visit Revenue: $26.6 million, 14.3% lower than last year, but 6.6% higher after normalizing for APC.
- Average Revenue Per Visit: $71, 8% lower than Q1 2024, but 8% higher after normalizing for APC.
- Q2 Revenue Guidance: Expected to be in the range of $62 to $67 million.
- Q2 Adjusted EBITDA Guidance: Expected to be in the range of negative $12 to $10 million.
- 2025 Revenue Guidance: Expected to be in the range of $250 to $260 million.
- 2025 Adjusted EBITDA Guidance: Expected to be in the range of negative $55 to $45 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- American Well Corp (AMWL, Financial) reported a strong start to 2025 with significant progress towards achieving positive cash flow from operations by 2026.
- The company made substantial advancements in its partnership with the military health system, positioning itself as a major contributor in the federal market landscape.
- AMWL's software revenue grew over 30% from Q1 of last year, driven by strategic client deployments.
- The company successfully increased its mix of subscription software revenues, targeting meaningful margin expansion this year.
- AMWL's platform reported high patient and provider satisfaction, with scores well over 90%.
Negative Points
- The deployment timing of AMWL's automated and digital behavioral health programs has been delayed to Q3 due to leadership transitions at the DHA.
- The company experienced a 23% decrease in completed visits compared to the previous year, reflecting a decline in visit revenue.
- Average revenue per visit decreased by 8% compared to last year's Q1.
- AMWL's adjusted EBITDA remains negative, although it has improved from the previous year.
- There is uncertainty regarding the renewal of the DHA contract, which is crucial for AMWL's future revenue projections.
