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 just reported scale. The analysis points to sleep, resupply, and maternal health becoming larger contributors to revenue, which reduces reliance on legacy ventilation and improves capital efficiency. At the same time, the ventilation segment appears to be navigating through the NCD transition, showing better new-start activity and improving compliance, though turnover continues to pressure census.
Key financial takeaways include a meaningful improvement in free cash flow (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. The revenue mix continues to improve, with ventilator rentals declining to 46.9% of revenue from 54.4%, while commercial payors increased to 23% from 17%.
Sleep and resupply remain the clearest growth drivers. PAP patients increased 57% year-over-year to 35,938, new patient starts grew 42%, and resupply patients increased 47% year-over-year. According to the announcement, the broader mix is driving stronger FCF conversion as sleep, resupply, and maternal health scale.
For more details, view the full announcement here. Stonegate Capital Partners is a leading capital markets advisory firm providing investor relations, equity research, and institutional investor outreach services for public companies. Its affiliate, Stonegate Capital Markets (member FINRA), offers a full spectrum of investment banking, equity research, and capital raising for public and private companies.