Healthequity (HQY) AI Stock Analysis

• Market Cap: $7.87B
• Dividend Yield: N/A
• Average Volume (3M): 861.81K
• Price to Earnings (P/E): 66.3
• Beta (1Y): 0.64
• Revenue Growth: 19.21%
• EPS Growth: 50.06%
• Country: US
• Employees: 3,105
• Sector: Healthcare
• Sector Strength: 38
• Industry: Medical - Healthcare Information Services
• EPS (TTM): 0.97
• Shares Outstanding: 86,475,350
• 10 Day Avg. Volume: 689,122
• 30 Day Avg. Volume: 861,813
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.07
• Enterprise Value/Revenue: 6.76
• Enterprise Value/Gross Profit: 10.72
• Enterprise Value/Ebitda: 22.12
• 1Y Price Target: $121.85
• Price Target Upside: 33.81% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 13

• Rating: 74 Outperform
• Price Target: $102.00 ▲(12.01%Upside)

HealthEquity's strong financial performance and positive earnings call sentiment are the primary drivers of its overall score. However, technical analysis indicates potential bearish momentum, and the high P/E ratio suggests overvaluation. The stock buyback program provides a positive corporate event uplift, but economic uncertainties impacting HSA sales pose a risk.

Positive Factors

Financial Performance

HealthEquity reported financial results that topped expectations and full-year guidance was raised.

Legislation Impact

The revised Senate bill reinstates provisions allowing Bronze & Catastrophic plans to qualify as HDHPs for HSAs, unlocking a 5MM+ member TAM.

Revenue Growth

Total revenue increased 15.0% to $330.8 million, driven by robust custodial revenue growth.

Negative Factors

Legislation Challenges

The likelihood of HSA provisions being added back is low due to the cost.

Macroeconomic Environment

Growth of HSA accounts showed a slight decline compared to the previous years, influenced by macroeconomic uncertainty.

Market Sentiment

Sentiment has cooled recently, as HQY shares dropped significantly while the S&P saw a slight increase, suggesting market anticipated the HSA omission in Senate's version of the bill.

Healthequity Business Overview & Revenue Model

Company Description

HealthEquity, Inc. provides technology-enabled services platforms to consumers and employers in the United States. The company offers cloud-based platforms for individuals to make health saving and spending decisions, pay healthcare bills, compare treatment options and prices, receive personalized benefit and clinical information, earn wellness incentives, grow their savings, and make investment choices; and health savings accounts. It also provides mutual fund investment platform; and online-only automated investment advisory services through Advisor, a Web-based tool. In addition, the company offers flexible spending accounts; health reimbursement arrangements; and Consolidated Omnibus Budget Reconciliation Act continuation services, as well as administers pre-tax commuter benefit programs. It serves clients through a direct sales force; benefits brokers and advisors; and a network of health plans, benefits administrators, benefits brokers and consultants, and retirement plan record-keepers. The company was incorporated in 2002 and is headquartered in Draper, Utah.

How the Company Makes Money

HealthEquity generates revenue through various streams, primarily from account fees, custodial fees, and interchange fees associated with its health savings accounts (HSAs). Account fees are charged to employers and individuals for maintaining and managing HSAs and other related accounts. Custodial fees are earned by managing the assets held in these accounts. Additionally, HealthEquity benefits from interchange fees on transactions made using HSA-linked debit cards. The company also partners with employers, benefits administrators, and health plans to offer its services as part of employee benefits packages, enhancing its market reach and revenue potential.

Healthequity Financial Statement Overview

Summary

Healthequity demonstrates strong financial performance with significant revenue growth and improved profitability. The balance sheet is stable with moderate leverage, and cash flows are healthy, reflecting efficient operations and effective cash management. The company is well-positioned for future growth, though debt levels should be monitored.

Income Statement

Healthequity shows a strong financial performance with significant revenue growth and improved profitability. Gross Profit Margin is robust at 63.0%, and Net Profit Margin has improved to 9.8% in the TTM period. Revenue growth is impressive, with a 24.1% increase from the previous year. The EBIT Margin is healthy at 16.5%, and the EBITDA Margin is solid at 30.5%, reflecting efficient operations.

Balance Sheet

The balance sheet of Healthequity is stable with a reasonable Debt-to-Equity Ratio of 0.52, indicating moderate leverage. The Return on Equity (ROE) has improved significantly to 5.7%, showing effective utilization of equity. The Equity Ratio is strong at 62.2%, highlighting a solid equity base. However, total debt levels have increased slightly, which should be monitored for future stability.

Cash Flow

Cash flow analysis reveals strong operational cash generation with an Operating Cash Flow to Net Income Ratio of 2.78, indicating robust cash conversion. The Free Cash Flow Growth Rate is healthy at 158.6% from the previous period, and the Free Cash Flow to Net Income Ratio is 0.72, showing effective cash management. Despite a high capital expenditure, free cash flow remains positive.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	1.20B	999.59M	861.75M	756.56M	733.57M
Gross Profit	777.26M	622.64M	490.09M	423.71M	415.33M
EBITDA	337.54M	282.42M	171.53M	102.97M	154.93M
Net Income	96.70M	55.71M	-26.14M	-44.29M	8.83M
Balance Sheet
Total Assets	3.45B	3.16B	3.09B	3.11B	2.71B
Cash, Cash Equivalents and Short-Term Investments	295.95M	403.98M	254.27M	225.41M	328.80M
Total Debt	1.11B	933.14M	994.49M	1.01B	1.07B
Total Liabilities	1.33B	1.13B	1.19B	1.25B	1.33B
Stockholders Equity	2.11B	2.04B	1.90B	1.85B	1.38B
Cash Flow
Free Cash Flow	337.77M	196.75M	31.52M	3.91M	84.66M
Operating Cash Flow	339.86M	242.83M	150.65M	141.00M	181.62M
Investing Cash Flow	-505.45M	-46.07M	-119.13M	-639.25M	-96.96M
Financing Cash Flow	57.57M	-47.04M	-2.67M	394.86M	52.42M

Healthequity Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 91.06
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HQY, the sentiment is Negative. The current price of 91.06 is below the 20-day moving average (MA) of 97.29, below the 50-day MA of 101.16, and below the 200-day MA of 97.54, indicating a bearish trend. The MACD of -1.62 indicates Positive momentum. The RSI at 35.59 is Neutral, neither overbought nor oversold. The STOCH value of 40.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HQY.

Healthequity Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PGNY	82 Outperform	$1.93B	39.69	10.11%	―	9.47%	-7.81%
DOCS	76 Outperform	$10.74B	51.77	22.50%	―	19.98%	53.10%
HQY	74 Outperform	$7.87B	66.28	5.77%	―	19.21%	50.06%
PINC	68 Neutral	$1.75B	37.26	6.05%	3.90%	-17.69%	-10.24%
GDRX	64 Neutral	$1.62B	60.97	4.43%	―	4.35%	―
Sector *	51 Neutral	$7.35B	0.50	-65.61%	2.47%	15.28%	1.44%
TDOC	44 Neutral	$1.23B	―	-14.18%	―	-2.57%	79.86%

Healthequity Corporate Events

Healthequity Announces New $300 Million Stock Buyback

On June 26, 2025, Healthequity held its Annual Meeting where stockholders approved all three proposals, including the election of nine directors and the ratification of PricewaterhouseCoopers LLP as the independent accounting firm. Additionally, the board authorized a new $300 million stock repurchase program, supplementing the previous program, allowing the company to repurchase shares under favorable market conditions.

The most recent analyst rating on (HQY) stock is a Hold with a $108.00 price target. To see the full list of analyst forecasts on Healthequity stock, see the HQY Stock Forecast page.