Doximity Inc. (NYSE:DOCS) is one of the oversold stocks to buy now. On December 15, Morgan Stanley upgraded Doximity to Overweight from Equal Weight with a price target of $65, which was increased from $62. Morgan Stanley stated that Doximity’s recent stock underperformance is inconsistent with the company’s business checks and the platform’s growing user engagement. The firm suggested that both company guidance and Street estimates appear conservative, creating what they view as an attractive entry point ...

Core Insights - Hims & Hers Health, Inc. (HIMS) operates a technology-driven digital health platform that provides personalized care through software, data, and virtual clinical workflows [1][2] - The company has launched new services, including Labs for biomarker tracking and expanded offerings in menopause and men's health [2][7] - Recent acquisitions, including Livewell and YourBio Health, enhance HIMS' diagnostic capabilities and geographic reach [3][7] Company Developments - Hims & Hers has introduced Labs, allowing customers to monitor biomarkers and receive personalized action plans from doctors [2][7] - The company has expanded into menopause care and launched branded testosterone treatments with at-home testing options [2][7] - The acquisition of Livewell marks HIMS' entry into Canada, while YourBio Health integrates blood-sampling technology into its platform [3][7] Financial Performance - Hims & Hers shares have increased by 56.7% year to date, outperforming the industry growth of 8.1% [6] - The forward 12-month price-to-sales ratio for HIMS is 3.2X, lower than the industry average of 4.9X but higher than its three-year median of 2.6X [9] - The Zacks Consensus Estimate for HIMS' 2025 earnings per share indicates a 77.8% improvement from 2024 [9]

Core Insights - Hims & Hers Health, Inc. operates as a connected healthcare platform, linking consumers with licensed clinicians, diagnostics, and pharmaceutical partners, focusing on coordinated care rather than isolated transactions [1][3] Company Developments - Recent launches include a new Labs offering for whole-body diagnostic testing, providing customers with biomarker insights and clinician-developed action plans [2] - The menopause specialty connects women to hormonal health providers, expanding treatment options with ongoing clinical oversight [2] - Innovative testosterone treatments for men, supported by at-home testing and provider review, illustrate the integration of pharmaceutical collaboration, diagnostics, and personalized care [2][7] Market Performance - Hims & Hers shares have gained 39.1% year to date, outperforming the industry growth of 9.4% [6] - The forward 12-month price-to-sales ratio for Hims & Hers is 2.8X, lower than the industry average of 5.1X but higher than its three-year median of 2.6X [9] Earnings Estimates - The Zacks Consensus Estimate for Hims & Hers' 2025 earnings per share suggests a 77.8% improvement from 2024 [9] - Current quarter EPS estimate is 0.04, with a projected increase to 0.14 next quarter [10]

Core Insights - Doximity, Inc. reported adjusted earnings per share (EPS) of 45 cents for Q2 fiscal 2026, a 50% increase year over year, exceeding the Zacks Consensus Estimate by 18.4% [1][8] - The company's revenues reached $168.5 million in Q2, reflecting a year-over-year growth of 23.2% and surpassing the Zacks Consensus Estimate by 6.8% [2][8] Revenue Breakdown - Subscription revenues amounted to $159.5 million, up 23% year over year, driven by increased spending from existing customers and a net revenue retention rate of 118% [3] - Other revenues totaled $9.1 million, marking a 25.9% increase year over year [3] Margin Analysis - Gross profit increased by 23.5% year over year to $152.1 million, with a gross margin expansion of 30 basis points to 90.3% [4][8] - Operating profit was $63.7 million, a 19.8% increase from the prior year, although the operating margin contracted by 100 basis points to 37.8% [5][8] Financial Position - Doximity ended Q2 fiscal 2026 with cash and cash equivalents of $169.2 million, up from $137.3 million at the end of Q1 [6] - Cumulative net cash from operating activities was $156 million, compared to $109.6 million a year ago [6] Future Guidance - For Q3 fiscal 2026, Doximity expects revenues between $180 million and $181 million, exceeding the Zacks Consensus Estimate of $178.2 million [7] - The full fiscal year revenue outlook has been raised to between $640 million and $646 million, up from the previous estimate of $628 million to $636 million [9] Product and Engagement Highlights - The company introduced multiple product updates focused on AI and workflow expansion, including the integration of Pathway's medical dataset into DoxGPT [11] - Record engagement was noted with over 650,000 unique prescribers utilizing various digital tools, and AI-optimized program adoption accounted for 40% of bookings [12]

Financial Data and Key Metrics Changes - The company reported revenue of $169 million for Q2 2026, representing a 23% year-on-year growth and a 7% beat from the high end of guidance [6][11] - Adjusted EBITDA margin was 60%, amounting to $101 million, which was 15% above the high end of guidance [6][12] - Free cash flow increased by 37% year-on-year, reaching $91.6 million [13] Business Line Data and Key Metrics Changes - The company achieved an all-time record number of quarterly active subscribers for its Newsfeed, with double-digit growth in articles read [7] - Over 650,000 unique prescribers used the workflow tools in Q2, marking another all-time high [7] - AI tools saw the fastest growth, with quarterly active prescribers up more than 50% from the prior quarter [7] Market Data and Key Metrics Changes - The company finished the quarter with a net revenue retention rate of 118% on a trailing 12-month basis [11] - The number of customers contributing at least $500,000 each in subscription-based revenue increased by approximately 16% year-on-year [11] Company Strategy and Development Direction - The company is focusing on AI-optimized integrated programs, which represented over 40% of bookings in Q2, compared to less than 5% in the same quarter last year [15][39] - The integration of Pathway's medical data set and AI models into DoxGPT is expected to enhance the company's offerings in medical AI [8][60] - The company aims to maintain a 55%+ Adjusted EBITDA margin while investing in AI solutions [17] Management's Comments on Operating Environment and Future Outlook - Management expressed some uncertainty regarding the 2026 budget discussions, indicating a cautious approach to revenue expectations [20][21] - Despite potential headwinds, management remains optimistic about client engagement and the performance of integrated programs [21] - The company expects revenue for Q3 2026 to be in the range of $180 million to $181 million, representing a 7% growth at the midpoint [14] Other Important Information - The company repurchased $21.9 million worth of shares during Q2, with $280 million remaining in the existing repurchase program [13] - The company is excited about the long-term growth opportunities presented by its AI suite [17] Q&A Session Summary Question: Uncertainty around budget discussions - Management indicated that the uncertainty primarily relates to calendar 2026 budgets, which are expected to be finalized soon [20] Question: Future AI opportunities - Management expressed excitement about the potential for AI to add significant value for physicians, with plans to continue expanding AI capabilities [22][23] Question: Budget allocation changes - Management noted that clients are considering potential changes in budget allocations, particularly in light of recent policy changes [28][30] Question: Impact of direct-to-consumer advertising - Management acknowledged that while there are discussions around D2C advertising, it is still early to assess the impact on budgets [29][30] Question: Integrated programs and visibility - Management clarified that integrated offerings represented 40% of upsell sales in Q2, which provides better visibility for future revenue [48][49] Question: Market share and growth - Management stated that the company has been growing at about two times the market growth rate, with a strong competitive position [88][89]

Core Insights - Doximity, Inc. is recognized as a leading healthcare technology stock, utilizing AI-driven tools and strategic acquisitions to enhance its market position [1] - The recent acquisition of Pathway Medical significantly improves Doximity's DoxGPT tool, providing instant access to verified medical data and AI responses [2] - Doximity has introduced Doximity Scribe, an AI tool that automates clinical documentation, thereby reducing administrative workload for clinicians [3] Financial Performance - In the last quarter ending June 30, 2025, Doximity reported a 15% year-over-year revenue increase, reaching $145.9 million, surpassing analyst expectations [4] - The company achieved non-GAAP earnings per share (EPS) of $0.36, indicating strong financial performance [4] - User engagement and product adoption have notably increased, particularly for new AI scribe and workflow tools [4]

Core Insights - The article discusses the 12 best healthcare stocks to buy and hold for five years, highlighting the role of AI in improving healthcare services and addressing insurance denials [1][4]. Group 1: AI in Healthcare - Dr. Warris Bokhari's platform utilizes AI to appeal health insurance denials for approximately 70 autoimmune diseases, addressing a significant issue where 850 million denials occur annually in the U.S. [2][3]. - The platform was launched on October 2, 2024, and aims to assist patients in navigating care denials by generating appeal letters based on healthcare plans [4]. Group 2: Stock Selection Methodology - The selection of the top healthcare stocks was based on criteria including EPS growth of over 10% in the past five years, an expected EPS growth rate of at least 20% over the next five years, and a forward PE ratio greater than 20 [6]. - The final ranking of stocks was influenced by the number of hedge fund holders as tracked by the Insider Monkey database as of Q2 2025 [6][7]. Group 3: Company Highlights - **Intuitive Surgical, Inc. (NASDAQ:ISRG)**: Pioneered robotic-assisted minimally invasive surgery with its da Vinci systems, which are used globally. The company introduced advanced software features for its da Vinci 5 system in September 2025, enhancing surgical capabilities [9][10]. - **Doximity, Inc. (NYSE:DOCS)**: A leading healthcare technology stock that completed the acquisition of Pathway Medical, enhancing its AI-driven tools. The company reported a 15% year-over-year revenue increase, reaching $145.9 million for the quarter ending June 30, 2025 [13][15]. - **Penumbra, Inc. (NYSE:PEN)**: A leader in thrombectomy and vascular intervention technologies, recently introduced the Ruby XL System and the Lightning Bolt 6X device, expanding its product offerings and market reach [16][18].