, an analyst from BMO Capital, has initiated a new Buy rating on Phreesia (PHR).
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BMO Capital has given its Buy rating due to a combination of factors that highlight Phreesia’s strategic growth and financial potential. The firm has shifted its focus towards increasing revenue per client, which is being achieved through effective cross-selling strategies and the anticipated benefits from the AccessOne acquisition. This approach is expected to stabilize organic revenue growth and contribute to significant operating leverage, with projections of high-20s to low-30s EBITDA growth over the next few years.
BMO Capital also notes Phreesia’s ability to maintain a stable operating expense base while achieving mid-teens revenue growth, indicating strong cost management and efficiency improvements. The company’s efforts in reallocating spending towards high-growth areas, such as Network Solutions, further support its growth trajectory. These strategic initiatives, coupled with a favorable valuation compared to peers, underpin BMO Capital’s optimistic outlook and Buy rating for Phreesia.