The Althea Group Holdings Ltd (ASX: AGH) share price has fallen materially over the last few weeks following the coronavirus-induced market volatility.
All three are down almost 50% from recent highs, which is significantly more than the S&P/ASX 200 Index (ASX: XJO).
Why have they crashed lower?
The first reason for the sharp decline is of course the high risk nature of their shares. Given their limited revenues in a market which is largely in its infancy, investors were quick to sell them off and switch to safer options.
In addition to this, there are concerns about the impact the coronavirus is having on visits to the doctors. If potential patients are staying away from medical centres because of the outbreak, then prescription growth could be impacted greatly.
This could put pressure on their balance sheets and require further funding in the short to medium term.
How are they adapting?
This morning Althea released an update and advised how it is aiming to combat this potential headwind.
According to the release, the company is working closely with Healthcare Professionals (HCPs) and pharmacies to minimise any disruption to its patients.
This includes promoting telehealth services, fast tracking use of electronic prescriptions, and launching an e-commerce sales option via Althea Concierge platform.
How has it performed in March?
Positively, Althea has yet to be impacted materially and has continued its positive form in March.
According to the release, the month of March is on track to be the highest revenue month in Althea’s history. This has been driven by strong uptake from new patients and the “recurring revenue” it is generating from repeat patients.
This news has certainly gone down well with its shareholders. In morning trade the Althea share price has rocketed almost 17% higher to 24.5 cents.
However, time will tell if these initiatives are enough to maintain its growth in April and beyond.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.