One of the most important things happening in the world right now is the bankruptcy of our nation’s rural healthcare apparatus as the coronavirus pandemic outbreak picks up steam outside of major population centers and cities and states sit with devastated balance sheets and apparently no help coming from a Federal government that seems too partisan and polarized to function properly.
One company offering a real solution to this mess – at least, for the areas it serves – is ISW Holdings Inc (OTCMKTS:ISWH), a company ramping up with a tie-in of crypto and telehealth that is extremely compelling, especially given its strong run of financial performance over the past year.
ISWH has been growing on the back of its first-rate home healthcare service, Paradigm Home Healthcare (“PHH”), which has posted a series of strong quarterly reports, and is apparently on track for a fresh example when ISWH drops Q2 2020 data this month.
To the ancient Chinese, the same word meant both “Crisis” and “Opportunity”, which is one of the most insightful ideas you’re likely ever to come across. This is especially true for investors. And the US faces a number of crises right now – which should all be seen as opportunities.
The crisis faced by rural hospitals is an opportunity for home healthcare and telehealth providers such as ISWH. To that end, the company is moving fast to capitalize on this opportunity by expanding its reach in the home healthcare space and integrate powerful new telehealth technology to allow its client/patients to benefit from this resource without having to risk (financially or biologically) exposure to their local facilities unless it’s absolutely necessary.
This is a great example of a company doing well by doing good, which generally ends up benefitting shareholders over the long run.
Upcoming Data
One of the keys to this story is the financial performance we have been seeing from ISW Holdings Inc (OTCMKTS:ISWH), with a series of strong quarters lined up over the past year-plus demonstrating a curve of growth that’s hard to deny. Each report seems to be leveraging gains from the last to ramp up the curve to the next notch.
Whenever you see a company growing by double-digit percentage points on the topline on a sequential quarterly basis, you know you are looking at something important.
A company that posts 20% sequential quarterly hops is posting a curve set to top 100% y/y growth, which is all-star status. Over the past year, we have seen just that from ISWH in its PHH brand.
The question of whether or not we are set to see that type of growth yet again this month – when the company comes out with fresh Q2 2020 data – seems to have been answered in the affirmative last week when the company announced that it anticipates continued improvement and sequential quarterly revenue growth when performance data for quarter-ended June 30 are disclosed this month, with the bulk of gains driven by continued expansion in its Paradigm Home Healthcare division.
“Last week, we announced our new focus on the Pennsylvania project with Bit5ive and our participation in one of the most ambitious crypto mining facilities in the world, but the real breadwinner for the Company at present remains our flourishing home healthcare business,” commented Alonzo Pierce, president and chairman of ISW Holdings. “The strong performance in Q2 from PHH was highlighted by continued growth in new clients and new hires. We are also very excited about our upcoming integration of proprietary telehealth technology into PHH operations.”
According to the release, Management notes that the Company is on track to post a fifth consecutive quarter of sequential revenue growth in its PHH operations (and overall), with performance augmented by unique factors related to the current health crisis as well as longer-term tailwinds with demographic and socioeconomic roots. This strength is also being driven by wider adoption and deregulation around telehealth, more generally, which allows many more potential in-patients to opt for home healthcare through businesses like PHH while maintaining regular contact and consultation with their own healthcare professionals.
None Too Soon
The Texas region where the company operates most of its home healthcare activity will be glad to know that ISWH is actively beginning to incorporate telehealth technology into its operations.
According to a recent article in Politico, “For years, rural health providers have grappled with low patient volumes, staffing shortages and thin operating margins. Over 120 rural hospitals shuttered in the past decade, and another 1 in 4 were considered a high-risk for closure even before the pandemic hit. Now, the widespread cancellation of pricey elective surgeries, which make up the bulk of hospitals’ revenue, have made their finances all the more precarious.”
The rural healthcare situation is deeply imperiled. But, as noted above, it is often the case that Crisis equals Opportunity. Over the long-term, healthcare systems in the US were in need of a crisis to expedite an important evolutionary change that now appears to be irrevocably underway at last.
We would look to innovators in the space to find cues about where the story is heading next, with ISW Holdings Inc (OTCMKTS:ISWH) now in the perhaps unlikely position of an outside moving to the head of the class with big plans and big progress already in place.
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