Overview
ONEM shares have been on a run in recent weeks and months. The trackers point to upside for 4Q20 and solid guidance, as well as some upside to care margin. ONEM is likely to benefit from the COVID-19 vaccine rollout, as well as the return to in person care that we expect to follow. ARK Invest recently added a position as well.
Expectations for 4Q20
One Medical ($ONEM) member growth appears likely to beat guidance and expectations for 4Q20 and provide headroom for guidance for 1Q21. The current EV/Sales multiple has risen to 15x, but revenue estimates have not moved since the company reported 3Q20, beat estimates, and guided above 4Q20 consensus at the time. Heading into 4Q20 results and 1Q21 guidance, we expect membership and revenue to again come in above the guided range. We expect membership will likely exceed 530k-540k with app downloads pointing to 570k, resulting in revenue of $112M versus guidance of $104M-$109M. Consensus sits near the upper end of guidance.
Provider counts in our Provider Tracker continue to climb along with members, although at a slower pace. The ratio of members to providers is increasing which should lead to continued care margin expansion. Patient-physician ratios seen at traditional practices typically run at significantly higher levels. Longer term, ONEM market share has substantial headroom to increase membership within existing markets and by expanding to additional markets, both announced and unannounced.
Gaming COVID- 19 Vaccination System
There have been press reports that ONEM members are skipping ahead in the COVID-19 vaccination line by claiming to be front line health care workers and without One Medical asking for documentation. The increase in app downloads in January 2021 is significant and coincides loosely with COVID- 19 vaccine distribution, so the our member forecast may reflect only a temporary boost. However, the app download trend could reflect new members added to an annual health benefit update as the rolling 7- day count has fallen from the initial spike that began January 1. Regardless, we expect COVID19 vaccinations to drive significant patient volume in the coming months, and subsequently drive increases to in-person care, both of which are positive for ONEM.
App Downloads
Provider Tracker
Valuation Multiples
All data available upon request. Please reach out to with any inquiries.
Thomas Tobin
Managing Director
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