OMDA · Omada Health
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $19.63
Note written ·
Price against the kill line
27.0% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $19.63, on record since 10 November 2026. The shares are down 39.7% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $19.63, the 50-day average of closes (11 November 2026), would show the shares leading the S&P 500 and prove this call wrong.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Health Care
Quarter to 30 September 2026, filed 6 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 91.3
- Revenue, change on a year (%)
- +34.2
- Gross margin (%)
- 75.9
- Operating margin (%)
- 5.3
- Free cash flow, four quarters ($M)
- 28.2
- Price to earnings (×)
- 63.3
- Free-cash-flow yield (%)
- 3.2
All filed numbers
What Omada Health reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 91.3 | +34.2 | 75.9 | 5.3 |
| first filed | 87.8 | +43.1 | 72.6 | 4.0 |
| first filed | 78.0 | +42.0 | 62.4 | −6.1 |
| first filed | 75.8 | +58.1 | 70.8 | 4.3 |
| first filed | 68.0 | +49.5 | 66.3 | −3.7 |
| first filed | 61.4 | +48.9 | 65.7 | −7.1 |
| Pre-tax income ($M) | 6.6 |
| Net income ($M) four quarters: 14.0 | 6.6 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | +16.4 |
| Operating cash flow ($M) | 28.7 |
| Capital spending ($M) | 0.5 |
| Free cash flow ($M) | 28.2 |
| Cash and short-term investments ($M) | 243 |
| Debt ($M) | Not available |
| Net cash, cash less debt ($M) | Not available |
| Deferred revenue ($M) −4.9% on a year | 25.8 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 48.2 |
| Inventory ($M) | 4.9 |
| Shareholders' equity ($M) | 273 |
| Market value ($M) | 889 |
| Enterprise value, market value plus net debt ($M) | Not available |
| Enterprise value to sales (×) | Not available |
| Enterprise value to operating income (×) | Not available |
| Price to earnings (×) | 63.3 |
| Price to book value (×) | 3.3 |
| Free-cash-flow yield (%) | 3.2 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 13.4% of shares outstanding sold short, 6.7 days of average trading to cover, +12.0% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $1.7M |
| 12 monthsfrom | $0 | $12.2M |
The thesis
Omada Health delivered a better-than-expected third quarter and raised its full-year guide, but the shares still lost about a fifth of their value, because growth is slowing and 2027 is not quantified. The adjusted close was $15.09 on 9 November 2026, 39.6% below the $24.99 52-week high and well under the $19 June 2025 IPO price. The fourth-quarter report and the first 2027 outlook settle whether growth re-accelerates; until then the evidence favors the shares lagging the S&P 500.
The story is well known and losing ground: the GLP-1 (weight-loss drug) companion-care story is well known, and the 5 November 2026 report moved attention from margins to deceleration. The shares closed at $15.09 on 9 November 2026. The 14-day relative strength index (RSI) is 28.6, which is oversold.
Bullish and bearish views on Omada Health, Inc.
The bull case on Omada Health, Inc. (OMDA), in brief: guidance was raised again. The bear case: growth has slowed three quarters running.
Bull case
- Guidance was raised again. Omada's 5 November 2026 release lifted full-year 2026 revenue guidance to $344-346 million from $334-340 million, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance to $32-34 million from $21-27 million. Earnings Whispers described it as the third straight quarterly raise.
- Profitability moved sharply. Third-quarter revenue was $91.3 million, up 34% from $68.0 million. GAAP gross margin was 76% versus 66% a year earlier, net income was $6.6 million versus a $3.2 million loss, and adjusted EBITDA was $12.4 million versus $2.4 million, per the SEC-filed release.
- Revenue per member is improving. Trailing twelve-month revenue per total member was $294, up about 5% year over year, against $284 and about 2% at 30 June 2026.
- A large 2027 distribution contract starts on 1 January 2027. A finviz review of the call says the Health Care Service Corporation fully insured expansion, covering about 1.5 million lives, goes live that day and phases in through 2027.
- Selling pressure is extended. The RSI of 28.6 on 9 November 2026 and a 36.7% decline over three months show the move has been steep. Analyst targets remain above the price: Barclays' target is $22 (cut from $24 on 6 November 2026) and Wells Fargo's is $19.
Bear case
- Growth has slowed three quarters running. Revenue growth was 42% in the first quarter, 43% in the second and 34% in the third. Member growth slowed to 36% from 45% in the second quarter and 51% in the first, per the finviz review.
- The fourth quarter is guided lower. Earnings Whispers noted that the raised full-year guide implies fourth-quarter revenue below the third quarter and a slight sequential dip in total members. The chief financial officer said new enrollments should moderate sequentially in the fourth quarter.
- 2027 has no numbers. The release carries no 2027 outlook, and management declined to quantify 2027 covered lives or Flex Care signups, per the finviz review, which also points to declining employer GLP-1 coverage heading into 2027.
- Customer concentration. The same review puts related-party revenue at roughly $58 million of the $91 million quarter, about 64%.
- Analysts are cutting targets. Barclays lowered its target to $22 on 6 November 2026, after a cut to $24 on 28 October 2026 and a raise to $27 on 11 September 2026. Wells Fargo kept Equal-Weight and lowered its target to $19 on 6 November 2026.
- Leadership changes on 1 January 2027. President Wei-Li Shao becomes chief executive and co-founder Sean Duffy becomes Founder and Executive Chair.
Price setup
The adjusted close was $15.09 on 9 November 2026. Finviz reported the stock fell 20.37% on 6 November 2026, after a $19.43 close on 5 November 2026. The same page put the 200-day moving average at $17.72 before the report, so the shares now trade below it. The shares are 39.6% below the $24.99 52-week high and 36.7% lower over three months.
The RSI of 28.6 marks oversold conditions. No SEC filings were listed in the latest period, and no earnings date falls inside the next 30 days. Insider sales earlier in the year ran under Rule 10b5-1 pre-arranged plans. Crowding evidence is thin: no share issuance appears in recent filings, and the shares sit far below the 52-week high rather than extended above a moving average.
Catalysts ahead
- ~20 November 2026 (est.): Remaining analyst target and estimate revisions after the Q3 report. Shows whether the post-report cuts from Barclays and Wells Fargo spread to other firms covering the shares.
- 1 January 2027: CEO transition to Wei-Li Shao and start of the Health Care Service Corporation fully insured expansion (about 1.5 million lives). Starts the 2027 growth ramp that management has not yet quantified.
- ~25 February 2027 (est.): Q4 2026 results and first 2027 outlook. Settles whether growth re-accelerates from 34% or keeps slowing toward the 20% long-term floor.
What would change the view
A daily close above $19.63, the 50-day average of closes (11 November 2026), would show the shares leading the S&P 500 and prove this call wrong.
What it trades with
Omada trades with digital-health and employer-benefits names more than with the broad market. Employer decisions on GLP-1 coverage for 2027 plan design are the common driver. Health insurers' commentary on GLP-1 costs is the most direct outside read on that demand.
The evidence, claim by claim (7)
- Q3 2026 revenue was $91.3M, up 34% from $68.0M; GAAP gross margin 76% vs 66%; net income $6.6M vs a $3.2M loss; adjusted EBITDA $12.4M vs $2.4M. Omada Health Q3 2026 results release (SEC Form 8-K) · as of
- Total members were 1.1 million, up 36% year over year; trailing twelve-month revenue per total member was $294, up about 5%. Omada Health Q3 2026 results release (SEC Form 8-K) · as of
- FY2026 guidance raised to revenue $344-346M (from $334-340M) and adjusted EBITDA $32-34M (from $21-27M). Omada Health Q3 2026 results release (SEC Form 8-K) · as of
- Shares closed at $19.43 before the release and fell 20.37% on 6 November 2026. Finviz review of Omada Q3 2026 results · as of
- Revenue growth slowed from 42% (Q1) and 43% (Q2) to 34% (Q3); member growth slowed from 51% and 45% to 36%. Finviz review of Omada Q3 2026 results · as of
- Barclays lowered its price target to $22 (from $24); Wells Fargo kept Equal-Weight and lowered its target to $19. Benzinga headlines · as of
- Adjusted close was $15.09, 39.6% below the $24.99 52-week high; RSI(14) 28.6; 3-month change −36.7%. Split/dividend-adjusted daily closes · as of
Sources
- Omada Health, Inc. - Form 8-K - FY2026 · sec.gov
- Omada Health beats consensus but misses the whisper as third guidance raise collides with slowing growth and a cloudier 2027 · finviz.com
- Omada Health hikes 2026 outlook after 'strongest quarter ever' in Q3 · fiercehealthcare.com
- Omada Health reports third quarter 2026 results · finviz.com
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