Doximity Inc. (NASDAQ: DOCS) is a digital professional medical networking platform that is a cross between LinkedIn and Meta Platforms Inc. (NASDAQ: META) Facebook. The platform enables physicians to connect with their colleagues to collaborate on patient treatments and research. It also provides the latest medical news and research and provides access to various career tools. Doximity has grown to be a trusted source of information as it proves to be both sticky and engaging, attracting more physicians and keeping them on the platform.
Doximity operates in the medical sector and loosely competes with Teladoc Health Inc. (NYSE: TDOC), American Well Co. (NYSE: AMWL), and Microsoft Co. (NASDAQ: MSFT) owned LinkedIn.
The Largest Physician Network in the Country Continues to Grow
Doximity claims to have the largest verified physician network in the country, with 80% of U.S. physicians on the platform. It also claims 50% of nurse practitioners are also on the platform. Doctors actively use the platform to communicate and collaborate with colleagues. Doctors can exchange patient information, medical records, and notes. As the number of doctors joining the platform increases, more doctors will be attracted to join. Doximity has a remarkably high level of engagement, providing verified medical news and information, education, and research. The network can be accessed online and through its mobile app.
Virtual Patient Visits and Video Calls Without an App
Doctors can also perform virtual visits through its Dialer Video function, which lets patients connect through a no-reply text message and protects the doctor’s cell number. Patients don’t have to download or install an app or even create an account. Doctors can also use the Dialer Video to make video calls with colleagues or cell phone calls to patients while displaying the office phone number. Physicians can also publish Op-Med articles to be shared with its 2 million members. The mobile app averages 4.8 out of 5 stars based on 120,000 ratings.
DOCS Stock Forms a Rectangle Channel Breakout
The daily candlestick chart for DOCS illustrates a rectangle channel with an upper trendline resistance at $30.50 and lower trendline support at $25.00 heading into its fiscal Q1 2025 earnings release at $25.90. A robust top-and-bottom-line beat and raised guidance triggered a gap to $32.58 the following morning, which also triggered the breakout. The stock's daily relative strength index (RSI) sharply increased, surpassing the 70 level and maintaining its position above this threshold. Pullback support levels are at $32.58, $30.50, $27.11, and $25.90.
A Solid Start to Fiscal First-Quarter 2025
Doximity reported fiscal Q1 2025 EPS of 28 cents, beating consensus estimates of $22 by 6 cents. Net income rose 32.7% to $41.4 million and a margin of 32.7%. Non-GAAP net income margin was 44.1%, rising to $55.9 million from $40.6 million in the year-ago period. Revenues grew 17% YoY to $126.88 million, beating the $119.88 million consensus estimate. Unique active users were up double-digit percentages YoY as daily active users grew the most.
Net Retention Rate is Slipping
The net retention rate (NRR) fell to 114%, down from 118% in the year-ago period. Doximity collects 80% of its revenues from advertising and marketing sales to medical device manufacturers, suppliers, equipment makers, solutions providers, and pharmaceutical companies. It also collects subscription plans to enable certain features.
Doximity GPT is a Success
Doximity rolled out its generative AI tools, which enable telehealth, messaging, and scheduling. Doximity GPT has been tapped for over 1.5 million letter requests or prompts as physicians try to streamline their administrative tasks. Doximity GPT enables doctors to create medical correspondence like prior authorization and appeal letters to health insurers, clinical notes, and patient referral letters.
Upside Fiscal 2025 Guidance
Doximity provided upside fiscal Q2 2025 revenues of $126.5 million to $127.5 million versus $123.98 million consensus estimates. Fiscal full-year 2025 revenues are expected to be between $514 million and $523 million versus $512.20 million consensus estimates.
Doximity Co-Founder and CEO Jeff Tangney commented, “Doximity GPT provides a HIPAA-compliant writing assistant for doctors. To date, over 1.5 million letter requests or prompts have been completed on Doximity GPT, demonstrating the significant demand doctors have to cut or streamline administrative writing tasks.”
Doximity analyst ratings and price targets are at MarketBeat. There are 13 analyst ratings on DOCS stock, comprised of three Buys, eight Holds, and two Sells. The highest analyst price target is $38.00.
