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Omada Health, Inc. (OMDA)
NASDAQ:OMDA
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Omada Health, Inc.
(NASDAQ:OMDA)
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Rating:67Neutral
Price Target:
$15.00
▲(2.60% Upside)
Action:ReiteratedDate:03/07/26
The score is driven primarily by improving financial performance (rapid growth, margin expansion, positive 2025 operating/free cash flow, and a debt-free balance sheet) and a generally positive earnings-call outlook with continued EBITDA improvement guidance. Offsetting this are weak valuation support due to negative earnings and a mixed technical picture (negative MACD and price still below the 100-day average).
Positive Factors
Revenue Growth & Scale
Rapid, sustained top-line and membership growth in 2025 reflects durable commercial traction with employers and health plans. Scale increases network effects, strengthens sales leverage, and expands addressable covered lives, supporting recurring revenue and long-run margin conversion as unit economics improve.
Improving Margins & Cash Generation
Material margin expansion and a turn to positive operating and free cash flow signal structural efficiency gains (care-team and AI leverage). A debt-free balance sheet with sizable cash provides financial flexibility to invest in growth while reducing insolvency risk through nearer-term self-funding of operations.
Product, AI & Clinical Validation
Proprietary data, embedded AI, and peer‑reviewed outcomes create durable differentiation versus traditional care. Clinically validated programs improve retention and reimbursement clarity with enterprise buyers, enabling higher lifetime value per member and scalable, cost-efficient care delivery over multiple years.
Negative Factors
Guidance Deceleration
Management’s materially slower 2026 growth target reflects a conservative cadence and limited near-term contribution from new offerings. Persistently lower growth rates would lengthen the timeline to embed fixed costs and compress long-term margin upside versus a faster scale scenario.
Profitability Not Yet Sustained
A single profitable quarter amid a full-year loss shows profitability progress is recent and concentrated. Durable investor confidence depends on multi-quarter GAAP and free cash flow consistency; reversion risks from hiring, seasonality, or partner true‑ups could reverse recent gains.
Early-stage New Products & Coverage Risk
Key growth levers (GLP‑1 prescribing, Flex Care, cholesterol) are early in adoption and excluded from guidance, delaying revenue realization. Additionally, employer benefit design and payer coverage for GLP‑1s remain uneven, creating execution and monetization risk until adoption and reimbursement stabilize.
Omada Health, Inc. (OMDA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$861.49M
Dividend YieldN/A
Average Volume (3M)1.57M
Price to Earnings (P/E)―
Beta (1Y)2.02
Revenue Growth50.51%
EPS Growth50.92%
CountryUS
Employees849
SectorHealthcare
Sector Strength45
IndustryMedical - Healthcare Information Services
Share Statistics
EPS (TTM)0.08
Shares Outstanding58,925,438
10 Day Avg. Volume2,258,800
30 Day Avg. Volume1,569,126
Financial Highlights & Ratios
PEG Ratio0.97
Price to Book (P/B)4.01
Price to Sales (P/S)3.54
P/FCF Ratio54.46
Enterprise Value/Market Cap0.74
Enterprise Value/Revenue2.46
Enterprise Value/Gross Profit3.75
Enterprise Value/Ebitda-98.65
Forecast
1Y Price Target
$22.67Price Target Upside55.06% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
EPS Forecast (FY)0.06
Revenue Forecast (FY)$319.18M
Omada Health, Inc. Business Overview & Revenue Model
Company DescriptionOmada Health is a U.S.-based virtual-care provider offering clinically validated programs for chronic conditions like cardiometabolic disease, musculoskeletal care, and behavioral health—delivered digitally between doctor visits.
How the Company Makes MoneyOmada Health generates revenue through a subscription-based model, primarily targeting employers, health plans, and insurers who pay for their digital health programs as part of employee wellness initiatives or health management solutions. Key revenue streams include per-member-per-month fees, which are often based on the number of users enrolled in their programs. Additionally, the company benefits from partnerships with various healthcare organizations and payers, which may include arrangement for shared savings or performance-based incentives related to improved health outcomes. Omada’s focus on tackling chronic conditions also positions it well for reimbursement opportunities as healthcare systems increasingly shift towards value-based care.
Omada Health, Inc. Earnings Call Summary
Earnings Call Date:Mar 05, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 14, 2026
Earnings Call Sentiment Positive
The call emphasized strong operational momentum in 2025 with substantial top-line growth (53%), scale in membership (886k, +55%), record margin expansion, first GAAP profitable quarter and positive full-year adjusted EBITDA—backed by product innovation (GLP-1 prescribing/Flex Care, cholesterol), AI deployment and peer-reviewed outcomes. Management provided prudent 2026 guidance (midpoint ~22% growth) that deliberately excludes early contributions from new products, which moderates near-term upside but reflects conservative planning. Near-term headwinds include seasonality-driven Q1 costs, a one-time Q4 revenue true-up, and the early-stage nature of new offerings; however, the balance of evidence points to durable commercial traction, improving unit economics and continued investment in scalable AI/product capabilities.Q4-2025 Updates
Positive Updates
Strong Revenue Growth and Scale
Full-year 2025 revenue of $260 million, up 53% year-over-year; Q4 2025 revenue of $76 million, up 58% year-over-year. Members reached 886,000 at year-end, up 55% YoY with 314,000 net new members added in 2025 (55,000 net adds in Q4).
Profitability and Cash Generation Milestones
First quarter of GAAP net income in Q4 2025 with GAAP net income of $5 million. Full-year adjusted EBITDA positive at $6 million (2% margin) and Q4 adjusted EBITDA $8 million (11% margin). Converted 40% of incremental revenue to adjusted EBITDA in 2025. Generated positive operating cash flow for the full year and ended 2025 with $222 million in cash and no debt.
Record Margin Expansion
Q4 adjusted gross margin reached an all-time high of 73% (up 320 basis points YoY). Full-year adjusted gross margin improved to 68% (up 450 basis points YoY). GAAP gross margin expanded to 71% in Q4 and 66% for the full year, reflecting operating leverage and care-team/AI efficiencies.
Commercial Traction and Addressable Reach
Estimated covered/eligible lives grew to over 25 million (more than 5 million incremental covered lives added). Strong channel performance including PBMs and a large new channel partner; closed significant new customer relationships and expanded multi-condition adoption.
GLP-1 Program Scale and Outcomes
Scaled GLP-1 Care Track to over 150,000 members (added >100,000 in 2025). Evidence showed members persisting on GLP-1s achieved average ~18% weight loss vs ~12% in real-world evidence without structured support; members who discontinued GLP-1s largely maintained weight at 1 year (average weight change 0.8% vs 11–12% regain reported in some trials).
Product and AI Innovation
Launched GLP-1 prescribing capability, GLP-1 Flex Care, new cholesterol program, OmadaSpark AI assistant and Meal Map nutritional tool. Embedded AI across operations (care summarization, AI-assisted coding) and leveraged a large proprietary dataset (tens of millions of care messages, billions of data points) to improve personalization and efficiency.
Program Performance and Research Validation
Published 30 peer-reviewed manuscripts (including MSK study showing reduced utilization/costs vs in-person PT). Program-level growth: weight health revenue grew >50%; diabetes and hypertension revenue each grew ~45%+ YoY. Member engagement remained strong: >55% of 12-month members engaged monthly and >50% of 24-month members engaged monthly.
Operating Leverage versus Expense Growth
Adjusted operating expenses grew 24% for the full year (to $170 million) while revenue grew 53%, demonstrating expense leverage. Q4 GAAP operating expenses rose 28% YoY while supporting scale and product investments.
Negative Updates
Guidance Shows Deceleration vs 2025 Outperformance
2026 revenue guidance of $312–$322 million implies ~22% growth at the midpoint, a material slowdown from 53% growth in 2025. Management noted guidance excludes meaningful contributions from GLP-1 prescribing, GLP-1 Flex Care and cholesterol, and assumes no material improvement in enrollment conversion.
Full-Year GAAP Loss Despite Q4 Profit
Although Q4 delivered GAAP net income of $5 million, full-year GAAP net loss remained $13 million (an improvement vs a $47 million loss in 2024), indicating profitability progress is still recent and not yet sustained across the full year.
Seasonal and Near-Term Cost Pressure in Q1
Q1 is expected to be flat vs Q4 (after a $2 million one-time Q4 revenue true-up) and is the largest net-new enrollment quarter, carrying higher device shipment and care-team labor costs that will pressure near-term margins before improving later in the year.
One-Time Q4 Revenue True-Up
Q4 included a onetime $2 million transaction/true-up with a large partner that inflated Q4 revenue, gross profit and adjusted EBITDA and will not recur, complicating sequential comparisons into Q1.
Market and Benefit Design Uncertainty
Approximately 55% of large employers currently do not cover GLP-1s for obesity. Employer budget constraints, evolving PBM solutions and shifting GLP-1 pricing/utilization dynamics create uncertainty; management introduced GLP-1 Flex Care to address this but adoption and economics remain early.
Early-Stage New Products and Limited Near-Term Revenue Contribution
New initiatives (GLP-1 prescribing, GLP-1 Flex Care, cholesterol program) are nascent and management did not embed meaningful revenue contributions from them in 2026 guidance. Broader rollout timelines (e.g., cholesterol broader rollout expected in 2027) imply limited immediate upside.
Company Guidance
Omada guided 2026 revenue of $312–$322M (midpoint ≈ $317M, ~22% growth vs. 2025) and adjusted EBITDA of $7–$15M (midpoint ≈ $11M, ~+$5M vs. 2025), starting from a 2025 base of 886,000 members, >25M estimated covered lives, $260M revenue, $6M full‑year adjusted EBITDA (2% margin) and $222M cash; management expects Q1 roughly flat to Q4 (Q4 included a one‑time ~$2M true‑up), with Q1 seasonally heavier enrollment/device and care costs, did not assume meaningful contribution from GLP‑1 prescribing, GLP‑1 Flex Care or cholesterol nor material enrollment lift, and reiterated long‑term targets of >70% adjusted gross margin and 20%+ adjusted EBITDA margin while noting 2025 converted 40% of incremental revenue to adjusted EBITDA and ARPU is roughly just shy of $300 per ending member.Omada Health, Inc. Financial Statement Overview
Summary
Strong improvement trajectory: sharp revenue acceleration in 2025, expanding gross margin, materially narrowing losses, and a turn to positive operating and free cash flow. Balance sheet is conservative with no debt and a larger equity base, but profitability is still not consistently positive and cash flow durability is not yet proven across multiple years.Income Statement
The company is showing strong top-line momentum, with revenue accelerating sharply in 2025 (up ~41%) after solid growth in 2023–2024. Profitability is improving meaningfully: gross margin expanded to ~66% in 2025, and operating losses narrowed substantially versus prior years (net margin improved to about -5% from roughly -28% in 2024). The key weakness is that the business is still not profitable on an earnings basis, with negative EBIT/EBITDA and net income remaining below zero despite the clear trajectory toward breakeven.72
Positive
Balance Sheet
Balance sheet strength improved materially in 2025, highlighted by zero reported debt and a much larger equity base (~$230M) alongside total assets of ~$305M. This reduces financial risk and provides flexibility to fund growth. The main concern is continued losses, which keep returns on equity negative in all years shown; sustained unprofitability could pressure equity over time even with today’s low leverage.78
Positive
Cash Flow
Cash generation turned a corner in 2025, with positive operating cash flow (~$18M) and positive free cash flow (~$17M) after multiple years of meaningful cash burn. This suggests improving operating discipline and working-capital dynamics. However, free cash flow growth is volatile (a large negative growth rate in 2025 off the prior-year base), and cash flow results have not yet demonstrated multi-year consistency given the 2022–2024 outflows.70
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 260.21M | 169.80M | 122.78M | 89.19M |
| Gross Profit | 170.50M | 102.88M | 69.97M | 42.79M |
| EBITDA | -6.48M | -37.83M | -58.36M | -63.99M |
| Net Income | -12.78M | -47.14M | -67.51M | -72.52M |
Balance Sheet | ||||
| Total Assets | 305.41M | 150.89M | 175.08M | 221.80M |
| Cash, Cash Equivalents and Short-Term Investments | 222.04M | 76.39M | 115.64M | 168.12M |
| Total Debt | 0.00 | 30.19M | 30.58M | 30.81M |
| Total Liabilities | 75.73M | 86.26M | 76.16M | 66.19M |
| Stockholders Equity | 229.68M | 64.63M | 98.92M | 155.60M |
Cash Flow | ||||
| Free Cash Flow | 16.93M | -38.04M | -52.66M | -71.70M |
| Operating Cash Flow | 18.25M | -34.18M | -49.74M | -68.98M |
| Investing Cash Flow | -5.83M | -3.86M | -2.92M | -2.72M |
| Financing Cash Flow | 133.22M | -1.21M | 179.00K | 16.32M |
Omada Health, Inc. Risk Analysis
Omada Health, Inc. disclosed 73 risk factors in its most recent earnings report. Omada Health, Inc. reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Omada Health, Inc. Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $861.49M | -72.16 | -7.10% | ― | 50.51% | 50.92% | |
52 Neutral | $13.93M | -0.47 | -291.07% | ― | ― | 61.10% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
45 Neutral | $2.43M | -0.37 | -202.20% | ― | -49.63% | 82.22% | |
42 Neutral | $1.84M | -0.18 | -145.52% | ― | ― | 97.70% | |
41 Neutral | $3.44M | -0.44 | -112.81% | ― | -21.88% | 68.40% | |
40 Underperform | $8.44M | >-0.01 | -220.42% | ― | -41.03% | 35.71% |
* Healthcare Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.