Financial PerformanceHQY reported strong operating results including revenue growth of 19% y/y and total HSA asset growth of 27% y/y.
Growth PotentialLonger term, there is a favorable outlook on the growing HSA market, HQY's ability to gain market share, and HSA cash repricing at higher yields, which should lead to margin expansion and double-digit EPS growth.
Market PositionThe stock had been outperforming peers and the market due in part to the flight to quality for some investors, the growing expectation for federal legislative improvements in the functionality of HSAs, and a reasonably stable interest rate outlook.