Actionable insights straight to your inbox


CareRx Doubles Revenue, Increases EBITDA by 86% in Fourth Quarter

CareRx is Canada’s largest and fastest growing provider of pharmacy services to seniors housing communities and other congregate care settings.

Image source: CareRx investor presentation, Dec 2021

CareRx Corp. (Toronto: CRRX) posted revenue from continuing operations of C$96.9 million (US$76.8 million) in the fourth quarter ended Dec. 31, 2021, up 109% from the same period the prior year.

Canada's largest seniors care pharmacy provider reported adjusted EBITDA from continuing operations increased to C$7.6 million (US$6.0 million) in Q4 2021, up 86% from the same period in 2020.

Net loss from continuing operations increased to C$4.4 million (US$3.5 million), compared to a loss of C$3.0 million in the prior year's quarter.

For the full year 2021, CareRx reported revenue from continuing operations of C$262.6 million (US$208.2 million), up 62% over 2020.

Adjusted EBITDA from continuing operations came in at C$22.9 million (US$18.2 million) for the year, up 79%.

Net loss from continuing operations was C$22.7 million (US$18.0 million) for 2021, compared to a net loss of C$18.3 million in 2020.

"The fourth quarter was a strong finish to an exceptional year that saw our bed count and revenue double as a result of the successful execution of our growth strategy," said David Murphy, President and CEO of CareRx.

Image source: CareRx investor presentation, Dec 2021

Investment thesis

CareRx stock is fallen over 25% from its August 2021 highs. The discount and current market cap of only C$225 million (US$178 million) feels unwarranted given the company's growth trajectory, market share and successful integration of multiple recent acquisitions.

  • Strong revenue and EBITDA growth
  • Company has 23% of the seniors housing beds in Canada, with the market expected to more than double over the next 15 years.
  • Company has made three acquisitions in the past two years, adding nearly 25,000 beds at accretive purchase multiples.
  • CareRx recently secured extensions with its two largest customers, representing approximately 15,000 total beds serviced, for an average of 5.5 years from the end of 2021.
  • The Ontario Ministry of Health recently postponed previously scheduled changes to long-term care pharmacy funding for a further year.
  • The company projects 130,000 beds and C$500 million in revenue by 2024.


Source: Equities News

The implications of the dollar potentially losing its status as the global reserve are numerous. Obviously, there may be currency risks, and decreased demand for U.S. Treasuries could lead to rising interest rates. I would also expect to see massive commodity price swings.
Many of us economy-watchers have been expecting recession, though with significant differences on odds and timing. Regardless, recent banking developments just made recession more likely and may have accelerated its onset.
Many people think of position size in terms of how many shares they own of a particular stock. But it’s much smarter to think of it in terms of what percentage of your total capital is in a particular stock.