Value
6.2/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 7.2 |
| Fwd P/E | 2.5 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 46.1x
- ▸PEG: 0.15
OMDA · Why this verdict
Why Omada Health (OMDA) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Omada Health is growing revenue rapidly with a perfect 4-quarter earnings beat streak, but the stock is technically overbought, has already exceeded its price target, and notable insider selling adds a cautionary signal.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Omada Health is growing revenue 42% year-over-year, earning a perfect growth score, and passes the Rule of 40 test at 48. Growth breakdown | Revenue growth stays above 25% YoY over the next several quarters. | →Stable |
| CounterDigital-health growth rates of this magnitude often decelerate quickly as the company scales past early-adopter customers. | ||
The stock is technically overbought with RSI at 85, and late-cycle distribution risk is flagged since the 200-day MA slope has gone flat-to-negative even as price stays above it. Momentum breakdown | RSI cools back into the 40-70 range without a sharp price breakdown. | ↓Deteriorating |
| CounterOverbought conditions in a strong secular growth story can persist for extended periods without triggering a reversal, especially with a clean beat streak. | ||
Notable insider selling of $1,481,434 (0.111% of market cap) adds a bearish signal that corroborates the value-trap flags. Insider breakdown | Insider selling activity declines to less than $500,000 in the next 90-day window. | →Stable |
| CounterInsider sales at growth-stage healthcare companies are frequently pre-scheduled selling plans (Rule 10b5-1) unrelated to near-term company outlook. | ||
The stock has already surpassed its analyst price target, now showing -11.0% implied upside, and the asymmetry ratio is negative at -0.73 as downside risk of 15% outweighs the negative upside. Warnings | Upside to price target recovers to a positive double-digit percentage. | Tripped↓Deteriorating |
| CounterA perfect 4-for-4 earnings beat streak with 220% average surprise could quickly justify analysts raising price targets, closing the gap from the price side rather than requiring a pullback. | ||
Omada has beaten earnings estimates in all of the last 4 quarters with an average surprise of 220%, reflecting consistent execution against low expectations. Earnings | The beat streak continues for at least 2 more consecutive quarters. | ↑Improving |
| CounterConsistently massive earnings beats can reflect a pattern of under-promising and over-delivering, which risks a sharp reversal once guidance is finally set more aggressively. | ||
Omada Health is growing revenue 42% year-over-year, earning a perfect growth score, and passes the Rule of 40 test at 48.
→StableGrowth breakdown
- Expectation
- Revenue growth stays above 25% YoY over the next several quarters.
CounterDigital-health growth rates of this magnitude often decelerate quickly as the company scales past early-adopter customers.
The stock is technically overbought with RSI at 85, and late-cycle distribution risk is flagged since the 200-day MA slope has gone flat-to-negative even as price stays above it.
↓DeterioratingMomentum breakdown
- Expectation
- RSI cools back into the 40-70 range without a sharp price breakdown.
CounterOverbought conditions in a strong secular growth story can persist for extended periods without triggering a reversal, especially with a clean beat streak.
Notable insider selling of $1,481,434 (0.111% of market cap) adds a bearish signal that corroborates the value-trap flags.
→StableInsider breakdown
- Expectation
- Insider selling activity declines to less than $500,000 in the next 90-day window.
CounterInsider sales at growth-stage healthcare companies are frequently pre-scheduled selling plans (Rule 10b5-1) unrelated to near-term company outlook.
The stock has already surpassed its analyst price target, now showing -11.0% implied upside, and the asymmetry ratio is negative at -0.73 as downside risk of 15% outweighs the negative upside.
Tripped↓DeterioratingWarnings
- Expectation
- Upside to price target recovers to a positive double-digit percentage.
CounterA perfect 4-for-4 earnings beat streak with 220% average surprise could quickly justify analysts raising price targets, closing the gap from the price side rather than requiring a pullback.
Omada has beaten earnings estimates in all of the last 4 quarters with an average surprise of 220%, reflecting consistent execution against low expectations.
↑ImprovingEarnings
- Expectation
- The beat streak continues for at least 2 more consecutive quarters.
CounterConsistently massive earnings beats can reflect a pattern of under-promising and over-delivering, which risks a sharp reversal once guidance is finally set more aggressively.
Per-dimension breakdown
Quality
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 9.3 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 9.1 |
| FCF quality | 4.2 |
| Moat | 6.2 |
| Rule of 40 | 8.0 |
| Piotroski F | 8.9 |
- ▸FCF-positive despite GAAP loss (FCF margin 6%, FCF yield 1.3%)
- ▸Rule of 40: 48 (pass)
- ▸Strong Piotroski F-Score: 8/9
Growth
10.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
- ▸Strong growth: 42% YoY
Momentum
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 5.3 |
| MA position | 5.0 |
| Volume | 2.6 |
- ▸Above 200-MA but MA slope flat
Sentiment
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.3 |
| Analyst rating | 7.1 |
| Price target | 6.8 |
- ▸LLM news sentiment: +0.47 (n=4)
Insider
2.0/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 0.0 |
| notable moves | 3.0 |
- ▸Notable insider selling — $4,917,126 (0.379% of mkt cap)
- ▸Institutions reducing
Peer rank
5.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.3 |
| quality rank | 3.5 |
| growth rank | 9.2 |
- ▸Industry growth leader
Technical
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 6.0 |
| support resistance | 4.2 |
| 52w position | 6.2 |
| gap | 6.0 |
Risk (lower is worse)
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 3.3 |
| days to cover | 3.3 |
| volatility | 0.8 |
| put call | 5.8 |
| implied vol | 0.0 |
| news risk | 6.0 |
- ▸High IV: 81%
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
7.6/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 14 days
How the verdict was assembled
Engine trigger
Heavy insider selling.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:INSIDER_FLOORPassed (4)
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.70
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:3.7<4.5
- ASYMMETRY:-0.1=NEGATIVE
- INSIDER:0.38%=HEAVY
Warning (1)
- EARNINGS_PROXIMITY:14d<=14d (soft)
Reward-to-Risk
-0.14
Upside
-2.1%
Downside
15.0%
Sizing output
AVOID
SetupRange Bound — RSI 42 mid-range, Bollinger mid-band
EdgeCatalyst-Driven — Earnings in 14d with 4/4 beat streak
SuitabilityAggressive — MCap $1.3B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 3.7<4.5 outcome against Growth at 10.0 and asymmetric R:R of -0.14.
The strongest dimensions are Growth at 10.0, Catalyst at 7.6, and Sentiment at 7.1; the weakest are Insider at 2.0, Risk (lower is worse) at 3.2, and Momentum at 3.7. The V9 engine flagged 3 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.14 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Revenue Growth
Trip ifRevenue growth falls below 20% YoY from the current 42% pace.
- P2Overbought Late Cycle Risk
Trip ifRSI stays above 80 for more than 4 consecutive weeks while the price breaks below the 200-day moving average.
- P3Notable Insider Selling
Trip ifInsider selling exceeds $3,000,000 in a single 90-day window, more than double the current $1,481,434.
- P4Target Reached Valuation CeilingTripped
Trip ifThe stock trades more than 20% above its analyst price target, worse than the current -11.0% upside.
- P5Consistent Earnings Beat Streak
Trip ifThe company's earnings surprise falls below 0% for 2 consecutive quarters, ending the current 4-quarter beat streak.