Nothing whatsoever about substantial fears that AI will destroy the company’s moat - in particular the key healthcare product. This may be simply speculation, but the market has taken it seriously enough to almost halve the value of the shares. No discussion of the company is complete without addressing these questions.
I wonder if anyone knows why the stock is so weak even though its 9month trade update is solid. I wonder if it has anything to do with the concern of the UpToDate's AI native competitor OpenEvidence. I found a YouTube video here the doctor explicitly said that he would not renew UpToDate's subscription. It is unclear to me that if every doctor cares about the most up to date information. http://www.youtube.com/watch?v=vZVQAK4tQi8
Yes, we think a part of it has to do with concerns about AI. UpToDate is a great example of that. Another reason is the exit of CEO Nancy McKinstry. She led the companies for decades, and is almost stepping down as CEO. Some analysts have raised concerns about the long-term AI vulnerabilities of WK. So for this year, even the year after, numbers will be perfectly fine. But there are warns for the years after. At this moment, pretty difficult to judge how this will play out. WK needs to act and invest in AI as well, which they do. Switching costs are still high in this industry, so that gives WK some time.
how often do the customers renew the contract of the SaaS software? if it is 3 years, then we will see the retention rate decline combined with increased AI spending.
Nothing whatsoever about substantial fears that AI will destroy the company’s moat - in particular the key healthcare product. This may be simply speculation, but the market has taken it seriously enough to almost halve the value of the shares. No discussion of the company is complete without addressing these questions.
Substacks is just our way of sharing lessons and certain companies we've analyzed. In our 27 page deep dive and podcast we going into these questions.
Appreciate keeping us sharp though! And agree.
We go into these questions*
I wonder if anyone knows why the stock is so weak even though its 9month trade update is solid. I wonder if it has anything to do with the concern of the UpToDate's AI native competitor OpenEvidence. I found a YouTube video here the doctor explicitly said that he would not renew UpToDate's subscription. It is unclear to me that if every doctor cares about the most up to date information. http://www.youtube.com/watch?v=vZVQAK4tQi8
Yes, we think a part of it has to do with concerns about AI. UpToDate is a great example of that. Another reason is the exit of CEO Nancy McKinstry. She led the companies for decades, and is almost stepping down as CEO. Some analysts have raised concerns about the long-term AI vulnerabilities of WK. So for this year, even the year after, numbers will be perfectly fine. But there are warns for the years after. At this moment, pretty difficult to judge how this will play out. WK needs to act and invest in AI as well, which they do. Switching costs are still high in this industry, so that gives WK some time.
how often do the customers renew the contract of the SaaS software? if it is 3 years, then we will see the retention rate decline combined with increased AI spending.
Not quite sure, Ethan.
Wolters keeps sliding down. would you do an update on the thesis ? is it time to buy?