Waterdrop (NYSE:WDH – Get Free Report) announced its quarterly earnings results on Tuesday. The company reported $0.05 EPS for the quarter, Zacks reports. The company had revenue of $213.16 million during the quarter. Waterdrop had a return on equity of 10.87% and a net margin of 12.47%.
Here are the key takeaways from Waterdrop’s conference call:
- Q2 revenue rose 72.8% year over year to CNY 1.45 billion, while operating profit increased 14.3% to CNY 111 million; management maintained profitability for the 18th consecutive quarter.
- The insurance business continued expanding, with reported insurance-related revenue up 80.5% year over year, new customers rising more than 30% sequentially, and long-term insurance premiums increasing 33.4% sequentially. AI tools are being used across acquisition, conversion, underwriting and servicing to improve productivity.
- Aggressive customer-acquisition spending pressured profitability, with sales and marketing expenses surging to nearly CNY 638 million from CNY 199 million a year earlier, largely due to third-party traffic investments. Net profit attributable to shareholders fell 10.3% year over year to approximately CNY 126–130 million, partly due to tax items and nonrecurring gains and losses.
- Management reiterated ambitious 2026 targets of more than 40% revenue growth and over 10% operating-profit growth, while signaling that active acquisition investment will continue through the second half of 2026 and into 2027 to build renewal, cross-sell and lifetime customer value.
- The company reported strong healthcare-platform momentum, including more than 1,500 quarterly clinical-trial enrollments, up 54% year over year, and an 80% increase in chronic-disease enrollments. With CNY 2.653 billion in cash and cash equivalents and investments, Waterdrop also approved a new $50 million share-repurchase program and an approximately $10.8 million dividend.
Waterdrop Trading Up 1.0%
NYSE:WDH opened at $1.03 on Tuesday. The stock has a market cap of $371.71 million, a P/E ratio of 4.90 and a beta of -0.08. The stock has a 50 day simple moving average of $1.09 and a 200 day simple moving average of $1.41. Waterdrop has a 1-year low of $0.96 and a 1-year high of $2.07.
Institutional Inflows and Outflows
Several large investors have recently added to or reduced their stakes in the company. Marshall Wace LLP acquired a new stake in Waterdrop in the 2nd quarter worth about $25,000. Sei Investments Co. acquired a new stake in Waterdrop during the third quarter worth approximately $26,000. Russell Investments Group Ltd. bought a new position in Waterdrop during the 3rd quarter worth $36,000. Centiva Capital LP bought a new position in Waterdrop during the 3rd quarter worth $59,000. Finally, Arrowstreet Capital Limited Partnership raised its holdings in Waterdrop by 184.0% in the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 39,372 shares of the company’s stock valued at $74,000 after acquiring an additional 25,510 shares in the last quarter. Institutional investors own 1.96% of the company’s stock.
Wall Street Analysts Forecast Growth
WDH has been the subject of several recent analyst reports. Weiss Ratings downgraded shares of Waterdrop from a “hold (c)” rating to a “hold (c-)” rating in a research note on Tuesday, July 28th. Wall Street Zen cut Waterdrop from a “buy” rating to a “hold” rating in a research report on Monday, July 6th. Two analysts have rated the stock with a Hold rating, Based on data from MarketBeat, the stock presently has a consensus rating of “Hold” and an average target price of $2.00.
Check Out Our Latest Analysis on WDH
About Waterdrop
Waterdrop Inc (NYSE: WDH) is a China-based insurtech and health protection platform that leverages digital technology to connect consumers with insurance and healthcare services. Through its mobile app and online marketplace, Waterdrop offers a range of microinsurance and critical illness products designed to provide affordable coverage for everyday risks. The platform also features crowdfunding channels that enable users to contribute to medical expense relief for individuals facing serious health challenges.
Since its founding in 2016 and headquartered in Shanghai, Waterdrop has grown its partner network to include leading insurance carriers and medical institutions across mainland China.
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