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Investing.com - Wells Fargo (NYSE:WFC) reduced its price target on American Well Corp . (NYSE:AMWL) to $12.00 from $15.00 on Thursday, while maintaining an Overweight rating on the telehealth company’s stock. The company, currently trading at $7.86, has shown strong momentum with an 8.41% return year-to-date, according to InvestingPro data.
The price target adjustment reflects Wells Fargo’s revised long-term revenue projections for American Well, commonly known as Amwell, based on its discounted cash flow (DCF) model.
Wells Fargo now forecasts American Well will reach $325 million in revenue by 2031, down from its previous estimate of $337 million, representing a 5% six-year compound annual growth rate (CAGR).
The financial institution’s model also anticipates American Well achieving adjusted EBITDA margins of 12% by 2031, indicating gradual profitability improvement for the telehealth provider.
Wells Fargo’s DCF valuation model for American Well incorporates a 3% terminal growth rate and an 8% required return, factors that contributed to the revised $12 price target.
In other recent news, Amwell reported a significant increase in its total revenue for the second quarter of 2025, reaching $70.9 million, which marks a 13% rise compared to the same period last year. This financial performance improvement is attributed to the company’s strategic initiatives in AI and digital healthcare solutions. There were no mergers or acquisitions reported for Amwell in this period. Additionally, there have been no recent analyst upgrades or downgrades for the company. The company’s latest developments reflect its focus on enhancing its digital offerings. Investors may find these revenue figures particularly noteworthy. These recent developments highlight Amwell’s ongoing efforts to strengthen its market position in the digital healthcare sector.
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