Cove Street Capital on Viemed (VMD)
Eugene Robin and Andrew Leaf from Cove Street discuss their investment in Viemed. Viemed targets organic growth rates over 30%, yet the company only trades for ~15x free cash flow. Andrew and Eugene lay out their case for why the market is wrong on this one, including why VMD's business model is advantaged versus their competitors and why they aren't scare of a Medicare cut in the near to medium term.
Cove Street's first podcast appearance on Viasat (VSAT): https://youtu.be/Otw0oWvuhdU\u200b
Chapters
0:00\u200b Intro
1:10\u200b Viemed overview
4:30\u200b Typical use case for VMD's ventilators
7:35\u200b Discussion of COPD market
12:35\u200b How VMD's business model is different than peers
24:20\u200b Why is the market valuing a 30% organic growth business at 15x free cash flow?
33:20\u200b Medicare cut risks and what happened in 2016
39:10\u200b VMD's acquisition potential
42:00\u200b VMD's moat with hiring therapists
47:00\u200b Discussing VMD's bad debt expense
50:00\u200b COVID's impact on VMD
53:30\u200b Cove Street's price target
59:40\u200b Parting thoughts