LifeMD (NASDAQ:LFMD) shares traded higher on Wednesday after KeyBanc Capital Markets launched its coverage with an Overweight rating and a $12 price target, citing the telehealth firm’s weight management program.
Analyst Steve Dechert noted that LifeMD’s (LFMD) weight management, which offers GLP-1 drugs such as Novo Nordisk’s (NVO) Wegovy and Eli Lilly’s (LLY) Zepbound, has increased its subscriber base to nearly 50K by mid-May compared to ~3K in Q2 2023.
“We expect its Weight Management Program, fueled by GLP-1 demand, to be the primary driver of significant revenue growth of ~35% in FY24 and ~25% in FY25,” Dechert wrote, projecting ~325% subscriber growth this year.
The analyst also expects new products from RexMD, LifeMD’s (LFMD) telehealth offering for men, and a potential $100M from the sale of the company’s SaaS business, WorkSimpli.
Dechert added that the proceeds from a potential divestment expected this year would help the company pay down its debt load and invest in its business.