Shares of Doximity (DOCS 2.02%) are on the move after an encouraging fiscal first-quarter earnings report. Investors excited about the niche healthcare networking platform's expanding profit margins drove the stock 21.9% higher as of 1:06 p.m. EDT on Wednesday.
Doximity made its stock market debut just a couple of months ago, so this was its first quarterly earnings report as a publicly traded company. Expectations were high, but the company exceeded them anyway.
During the company's fiscal first quarter ended June 30, 2021, total revenue more than doubled compared with the previous year to $72.7 million. The stock probably would have risen even further, but management also told investors to expect revenue during the fiscal second quarter to land in a range between $73 million and $74 million.
For the entire fiscal year, Doximity expects adjusted earnings before interest, taxes, depreciation, and amortization, or EBITDA, to land in a range between $106 million and $109 million. With an $11.4 billion market cap at the moment, you're probably thinking this stock's valuation is absolutely insane.
This company's unique position in America's gigantic healthcare system gives Doximity a pretty good chance to grow into its valuation. That's because out of around $4 trillion in annual U.S. healthcare spending, around three-quarters is heavily influenced by physician decisions. Doximity already counts among its members more than 80% of the nation's physicians.
In addition to being in a great place to market products and services to physicians, Doximity also operates a rapidly growing telehealth solution. Despite being relatively new to the game compared with companies like Teladoc Health, Doximity delivered 63 million telehealth visits last year. With diverse contributors to a high-margin revenue stream that's growing fast, this might be one of the best stocks you can buy right now.