Doximity, Inc. (NYSE: DOCS)

Sector: Healthcare Industry: Health Information Services CIK: 0001516513
Market Cap 4.63 Bn
P/B 4.73
P/E 19.35
P/S 7.26
ROIC (Qtr) 17.35
Div Yield % 0.00
Rev 1y % (Qtr) 9.76
Total Debt (Qtr) 10.69 Mn
Debt/Equity (Qtr) 0.01
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About

Doximity, Inc. (DOCS) operates as a leading digital platform for medical professionals in the United States, boasting over two million registered members as of March 31, 2024. The company's mission is to enhance physician productivity and improve patient care through its physician cloud, which provides medical professionals with digital tools tailored for their specific needs. Doximity's primary business activities revolve around its Marketing, Hiring, and Productivity Solutions, which serve pharmaceutical manufacturers, health systems, and medical...

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Investment thesis

Bull case

  • Strong operating cash flow of 315.42M provides robust 29.50x coverage of total debt 10.69M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 64.84M provide 31.19x coverage of short-term debt 2.08M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 1.03B provides 96.78x coverage of total debt 10.69M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 307.27M exceeds capital expenditure of 8.15M by 37.68x, indicating strong organic growth funding capability.
  • Tangible assets of 1.03B provide exceptional 15.57x coverage of deferred revenue 66.48M, showing strong service capability backing.

Bear case

  • Operating cash flow of 315.42M barely covers its investment activities of (15.28M), with a coverage ratio of -20.64, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (15.28M) provide weak support for R&D spending of 116.40M, which is -0.13x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 64.84M provide limited coverage of acquisition spending of (26.53M), which is -2.44x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Short-term investments of 670.29M significantly exceed cash reserves of 64.84M, which is 10.34x, indicating potentially excessive yield-seeking behavior at the expense of liquidity.
  • The company's operating cash flow of 315.42M shows concerning coverage of stock compensation expenses of 102.94M, with a 3.06 ratio indicating potential earnings quality issues.

Peer comparison

Companies in the Health Information Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GEHC GE HealthCare Technologies Inc. 37.32 Bn 16.66 1.87 10.00 Bn
2 TEM Tempus AI, Inc. 35.72 Bn -175.20 32.32 1.34 Bn
3 VEEV Veeva Systems Inc 28.87 Bn 33.55 9.37 0.09 Bn
4 BTSG BrightSpring Health Services, Inc. 7.67 Bn 59.17 0.62 2.70 Bn
5 HQY Healthequity, Inc. 6.45 Bn 33.65 5.00 1.03 Bn
6 DOCS Doximity, Inc. 4.63 Bn 19.35 7.26 0.01 Bn
7 WAY Waystar Holding Corp. 4.33 Bn 38.59 3.93 1.49 Bn
8 PRVA Privia Health Group, Inc. 2.67 Bn 147.20 1.31 0.01 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 3.87 1.94
EV to Cash from Ops. EV/CFO 14.19 -6.03
EV to Debt EV to Debt 418.57 145.43
EV to EBIT EV/EBIT 16.20 -101.02
EV to EBITDA EV/EBITDA 17.64 2.47
EV to Free Cash Flow [EV/FCF] EV/FCF 14.56 3.97
EV to Market Cap EV to Market Cap 0.97 -28.84
EV to Revenue EV/Rev 7.02 -0.03
Price to Book Value [P/B] P/B 4.73 7.66
Price to Earnings [P/E] P/E 19.35 98.34
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 -8.72
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 5.01
Dividend per Basic Share Div per Share (Qtr) 0.00 0.04
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 4.56
Interest Coverage Interest Coverage 0.00 -584.72
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -22.59 -23.97
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -60.77 167.20
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -1.33
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 18.90 -19.20
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 8.77 40.04
EBIT Growth (1y) % EBIT 1y % (Qtr) 9.14 -39.33
EBT Growth (1y) % EBT 1y % (Qtr) 9.14 6.33
EPS Growth (1y) % EPS 1y % (Qtr) 17.59 8.83
FCF Growth (1y) % FCF 1y % (Qtr) 32.40 -6.20
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 15.36 4.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.55 0.66
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.03
Cash Ratio Cash Ratio (Qtr) 0.43 1.81
Current Ratio Curr Ratio (Qtr) 6.63 3.20
Debt to Equity Ratio Debt/Equity (Qtr) 0.01 -0.43
Interest Cover Ratio Interest Cover Ratio 0.00 -584.72
Times Interest Earned Times Interest Earned 0.00 -584.72
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 45.70 -435.68
EBIT Margin % EBIT Margin % (Qtr) 43.32 -464.60
EBT Margin % EBT Margin % (Qtr) 43.32 -461.63
Gross Margin % Gross Margin % (Qtr) 89.70 44.04
Net Profit Margin % Net Margin % (Qtr) 37.50 -467.91