Reliq Health Technologies Inc (OTCMKTS:RQHTF) fine run, in the market, is showing no signs of slowing down, amidst talk that the small-cap health IT Company is destined for robust growth. Over the last few months, the stock has clocked record highs at the back of minor pullbacks, which have acted as buying opportunities.
The stock is already up by more than 80%, barely three months into the New Year. Investors appear to have taken note of the company’s attractive subscription-based business model, which has the potential to generate high-profit margins going forward.
Trading volumes have surged to record highs, above 400 million, an indication that the upward momentum could hold for long. With the stock currently trading at the $1.83 level, it faces immediate resistance at the $2.03 level, above which it could register a new all-time high. On the downside, support is seen at the $1.70 level, below which the stock could drop to the 1.60 level another key support level.
Any pullbacks in our view should present unique buying opportunities for establishing a long position in the stock.
Reliq Health Technologies Business Overview
Reliq Health Technologies is a health IT Company, focused on the development of innovative secure mobile solutions for the $20 billion Community Care market. The company’s lead product in the space is a mobile health platform called, iUGO Care that allows for two way communication between healthcare providers and patients.
The platform also monitors patient’s health-related activities such as adherence to medication schedule and sleeping patterns. The virtual care platform is designed to reduce readmissions and improve health outcomes.
Catalysts behind Recent Price Action
Reliq Health Technologies has been spiking higher in recent weeks, after announcing the signing of an agreement that paves way for a reliable stream of revenue. The health IT Company has reached an agreement with Life Home Health LLC, which will see its iUGO Care chronic care management telemedicine platform deployed in over 2,000 home care clients.
“We are excited to be working with Reliq Health to support our care providers in their day-to-day workflow, freeing up more time for patient care. We feel that incorporating cutting-edge technologies like the iUGO Care platform will help True Life improve health outcomes and reduce overall healthcare costs,” said Sonia Anciso, President.
$30 Million Recurring Revenue Opportunity
The company is on course to generate over $1.2 million in recurring annual revenue from the Life Home Partnership. The integration will also take to 50,000, the total number of patients that Reliq Health Technologies supports under its telemedicine platform. At full deployment, the platform should be able to generate over $30 million in annual recurring revenue.
The company’s transition to a revenue-generating entity is already gaining momentum having reported sales revenue of $878,205, for the three months ended December 31, 2007. Revenue for the six months ended December 31, 2017, was up by more than 500%, compared to the same period of 2016.
In addition to revenue growth, Reliq Health Technologies Reported earnings of C$0.01 a share.
Speculative Buy Rating
Buoyed by revenue growth, brokerage firm Beacon Securities has initiated coverage of Reliq Health technologies with a ‘speculative buy’ rating of the stock. The firm expects the health IT company to post earnings per share of $0.05 for the 2019 fiscal year, which would rise to $$0.13 by FY2020.
The Healthcare technologic company has already achieved the number 1 ranking, in the 2018 TSX Venture 50 in the technology space. The listing ranks Canada’s top 50 emerging publicly traded companies. Winners are usually selected based on market capitalization, growth in share price appreciation and trading volume.
In addition to the Life Home Health LLC agreement, Reliq Health technologies have begun onboarding diabetes patients into its virtual healthcare platform as part of a partnership with Sioux Lookout Meno Ya Wen Health Center.
“With the use of our low-touch, high-tech iUGO Care solution, ‘virtual care’ can be provided to diabetes patients in their own communities throughout Northwestern Ontario. Our platform supports remote patient monitoring and secure virtual communications, allowing clinicians to identify patients whose condition is becoming unstable and intervene early before a serious complication develops,” said CEO Dr. Lisa Crossly.
What Next for Reliq Health Technologies After 80% Rally
It goes without saying that the current stock price appears to be fully valued given that it is at record highs. Taking into consideration the strength of the upward momentum the stock could continue powering high, given the positive ratings the company continues to get from brokerage firms.
Any pullback from the current levels in our view would present a unique buying opportunity given the solid fundamentals that continue to support the upswing. The Company’s subscription-based model, for its virtual telemedicine platform, is expected to generate high-profit margins for the company, which should provide further share price support.
Disclosure: We have no position in RQHTF and have not been compensated for this article.