Q: I have chosen WELL as a positive example but I am puzzled by the apparent lack of performance for the sector. We have a health care problem; scads of people do not have a family doctor. I know the difficulty involves more than the services WELL can provide BUT I would have thought services such as those provided by companies like WELL would have been in demand, would have been able to provide some relief, their valuations would have prospered even during their development, and investors would have seen some benefits. Yet the sector valuations flounder. What am I missing?
We think it is largely perception. The pandemic highlighted a lot of stocks in the space, and many did very well. But post-pandemic there was a slowdown, and many investors simply view some as 'covid' stocks and do not care about them now. TDOC is the best example here. We think, over time, the sector will prove itself out. But we have a weak market, negative momentum, and year end and tax loss selling. We would not expect much in the short term.