Stonegate Capital Partners has updated its coverage on Viemed Healthcare, Inc. (NASDAQ: VMD), highlighting the company's first-quarter 2026 results that demonstrate improving growth quality beyond reported scale. The analysis points to sleep, resupply, and maternal health services becoming larger contributors to revenue, which reduces dependence on legacy ventilation and enhances capital efficiency. Meanwhile, ventilation services appear to be navigating the transition related to the National Coverage Determination (NCD), with improved new-start activity and compliance, although patient turnover continues to pressure census.
According to Stonegate, the broader revenue mix is driving stronger free cash flow (FCF) conversion as sleep, resupply, and maternal health scale. Key takeaways from the update include a meaningful improvement in FCF conversion: cash flow from operations (CFFO) increased to $8.1 million from $2.9 million in the prior year, while trailing twelve-month (TTM) FCF rose to $36.3 million from $23.3 million at year-end 2025. This indicates better capital efficiency and cash generation.
Revenue mix continues to improve, with ventilator rentals declining to 46.9% of total revenue from 54.4% in the prior year, while commercial payors increased to 23% from 17%. This shift reduces reliance on government payors and improves reimbursement stability. Sleep and resupply remain the clearest growth drivers: positive airway pressure (PAP) patients increased 57% year-over-year to 35,938, new patient starts grew 42%, and resupply patients increased 47% year-over-year. These metrics underscore the scalability of Viemed's non-ventilation businesses.
Stonegate Capital Partners provides investor relations, equity research, and institutional investor outreach services for public companies. The full announcement, including downloadable images and additional details, is available at https://www.stonegateinc.com.
