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HealthStream
(NASDAQ:HSTM)
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Rating:77Outperform
Price Target:
$34.00
▲(21.99% Upside)
Action:Reiterated
Date:08/05/26
HSTM scores well primarily due to strong financial quality (low leverage, improving profitability, and solid cash generation) and a constructive technical uptrend. The latest earnings update is supportive with raised guidance and strong recurring-revenue visibility, though tempered by one-time revenue benefit and higher planned operating spend. The biggest drag on the score is valuation, as the high P/E leaves less room for execution missteps.
Positive Factors
Recurring revenue & RPO
Very high subscription mix and sizeable remaining performance obligations provide durable revenue visibility and predictable cash conversion. This supports multi-year planning, capital allocation for product investment and M&A, and reduces cyclicality versus transaction-driven models.
Negative Factors
Rising operating expenses
Deliberate spending to scale career networks and platform capabilities raises the fixed cost base. If revenue growth slows in H2 or inorganic deals underdeliver, margin sustainability and near-term net income could be pressured, requiring disciplined ROI on hires and programs.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring revenue & RPO
Very high subscription mix and sizeable remaining performance obligations provide durable revenue visibility and predictable cash conversion. This supports multi-year planning, capital allocation for product investment and M&A, and reduces cyclicality versus transaction-driven models.
Read all positive factors
HealthStream Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks revenue down by product and service lines (for example, subscription software, professional services, and content licensing) to show which parts of the business drive growth and profits. A larger recurring subscription mix suggests more predictable cash flow and higher margins, while reliance on one-time or services revenue can mean lower margin potential and less revenue visibility. Shifts in these shares highlight where the company is gaining traction, facing competitive pressure, or exposed to customer concentration or healthcare spending cycles.
Breaks revenue down by product and service lines (for example, subscription software, professional services, and content licensing) to show which parts of the business drive growth and profits. A larger recurring subscription mix suggests more predictable cash flow and higher margins, while reliance on one-time or services revenue can mean lower margin potential and less revenue visibility. Shifts in these shares highlight where the company is gaining traction, facing competitive pressure, or exposed to customer concentration or healthcare spending cycles.
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The Fly
The FlyHealthStream (HSTM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$839.77M
Dividend Yield0.45%
Average Volume (3M)215.55K
Price to Earnings (P/E)41.0
Beta (1Y)0.64
Revenue Growth8.78%
EPS Growth7.61%
CountryUS
Employees1,150
SectorHealthcare
Sector Strength45
IndustryMedical - Healthcare Information Services
Share Statistics
EPS (TTM)0.72
Shares Outstanding29,239,956
10 Day Avg. Volume287,357
30 Day Avg. Volume215,553
Financial Highlights & Ratios
PEG Ratio-4.99
Price to Book (P/B)1.96
Price to Sales (P/S)2.28
P/FCF Ratio11.61
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$29.00Price Target Upside4.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)0.73
Revenue Forecast (FY)$327.28M
HealthStream Business Overview & Revenue Model
Company Description
HealthStream, Inc., established in 1990 and headquartered in Nashville, Tennessee, delivers specialized workforce and provider solutions to healthcare organizations throughout the United States. Its operations are divided into two primary segments...
How the Company Makes Money
HealthStream generates revenue primarily by selling subscription-based software and content to healthcare organizations. A key driver is recurring revenue from cloud-delivered platforms used for workforce learning and development (training adminis...
HealthStream Earnings Call Summary
Earnings Call Date:Aug 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 26, 2026
Earnings Call Sentiment Positive
The call conveyed a broadly positive operational and financial performance with record revenue, record adjusted EBITDA, strong product growth (notably ShiftWizard and myClinicalExchange), expanding platform capabilities (Insights/hStream) and robust cash flow and balance sheet. Management also increased guidance for revenue and adjusted EBITDA for 2026. Offsetting factors include a $2M non-recurring revenue catch-up that boosted results, rising operating expenses tied to deliberate investments (career networks, product development and sales expansion) that trimmed net income guidance, ongoing migration away from legacy products, a disclosed cybersecurity incident under investigation, and expectations for slower revenue growth in the second half. Overall, the positive items meaningfully outweigh the negatives, though investors should note the one-time revenue impact and near-term cost/investment dynamics.Positive Updates
Record Revenue and Profitability
Second-quarter revenue of $83.7M, up 12.5% year-over-year; record adjusted EBITDA of $20.6M, up 16.9% year-over-year; operating income up 41.4% to $8.3M; net income $6.7M, up 23.8%; EPS $0.23 vs $0.18 prior year.
Negative Updates
Non-Recurring Revenue Boost
Second-quarter included a $2.0M one-time revenue catch-up related to a contingent-fee contract (ANSOS acquisition) that boosted Q2 results; company said this revenue is non-recurring and incremental to prior expectations.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Revenue and Profitability
Second-quarter revenue of $83.7M, up 12.5% year-over-year; record adjusted EBITDA of $20.6M, up 16.9% year-over-year; operating income up 41.4% to $8.3M; net income $6.7M, up 23.8%; EPS $0.23 vs $0.18 prior year.
Read all positive updates
Company Guidance
HealthStream updated 2026 guidance to consolidated revenues of $327–332 million (growth of 7.5%–9.2% vs. 2025), net income of $19.5–22.2 million, adjusted EBITDA of $74–78 million, and capital expenditures of $31–34 million; management expects Q3 revenue growth of ~8% and Q3 adjusted EBITDA margin of ~22%. The update follows a strong Q2 (revenues $83.7M, +12.5% Y/Y; adjusted EBITDA $20.6M, +16.9%, margin 24.6%; operating income $8.3M, +41.4%; net income $6.7M, +23.8%; EPS $0.23) and reflects elective investments (15 new career‑network hires) and higher H2 operating expenses; Q2 results were aided by a $2M one‑time revenue catch‑up. Remaining performance obligations were $685M (≈40% recognized in 12 months, 68% in 24 months), cash & investments were $66.7M, DSO 38 days, YTD operating cash flow $40.6M and YTD free cash flow $24.7M.HealthStream Financial Statement Overview
Summary
Income Statement
76
Positive
Balance Sheet
88
Very Positive
Cash Flow
82
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 321.12M | 304.06M | 291.65M | 279.06M | 266.83M | 256.71M |
| Gross Profit | 208.98M | 196.85M | 193.71M | 184.04M | 175.68M | 165.68M |
| EBITDA | 71.74M | 66.70M | 66.05M | 59.59M | 53.53M | 44.58M |
| Net Income | 21.20M | 18.34M | 20.01M | 15.21M | 12.09M | 5.84M |
Balance Sheet | ||||||
| Total Assets | 521.60M | 520.37M | 510.77M | 499.94M | 497.74M | 486.75M |
| Cash, Cash Equivalents and Short-Term Investments | 66.73M | 57.00M | 97.22M | 71.13M | 53.91M | 51.95M |
| Total Debt | 13.43M | 14.68M | 20.17M | 20.25M | 23.32M | 29.11M |
| Total Liabilities | 164.99M | 166.35M | 151.41M | 159.19M | 163.68M | 147.73M |
| Stockholders Equity | 356.61M | 354.02M | 359.36M | 340.75M | 334.06M | 339.02M |
Cash Flow | ||||||
| Free Cash Flow | 48.85M | 59.63M | 29.52M | 61.77M | 49.42M | 38.97M |
| Operating Cash Flow | 71.79M | 63.32M | 57.66M | 63.97M | 51.19M | 42.38M |
| Investing Cash Flow | -50.16M | -50.35M | -33.97M | -56.60M | -28.39M | -25.72M |
| Financing Cash Flow | -27.52M | -36.27M | -4.52M | -13.04M | -23.70M | -6.21M |
HealthStream Technical Analysis
Positive
27.87
Price Trends
27.22
Positive
24.52
Positive
23.72
Positive
Market Momentum
0.46
Positive
58.05
Neutral
40.36
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HSTM, the sentiment is Positive. The current price of 27.87 is below the 20-day moving average (MA) of 28.28, above the 50-day MA of 27.22, and above the 200-day MA of 23.72, indicating a bullish trend. The MACD of 0.46 indicates Positive momentum. The RSI at 58.05 is Neutral, neither overbought nor oversold. The STOCH value of 40.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HSTM.
HealthStream Risk Analysis
HealthStream disclosed 38 risk factors in its most recent earnings report. HealthStream reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
HealthStream Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $1.11B | 7.53 | 47.97% | ― | 6.88% | 155.98% | |
77 Outperform | $839.77M | 41.04 | 6.01% | 0.47% | 8.78% | 7.61% | |
68 Neutral | $1.41B | 368.04 | 1.84% | ― | 47.63% | ― | |
60 Neutral | $130.19M | -0.47 | -129.70% | ― | -7.54% | -143.41% | |
52 Neutral | $446.58M | -0.88 | -99.16% | ― | -4.50% | -184.71% | |
52 Neutral | $102.57M | -0.44 | -67.07% | ― | -3.89% | 63.03% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
HSTM
HealthStream
29.37
3.55
13.77%
EVH
Evolent Health
3.93
-5.29
-57.38%
HCAT
Health Catalyst
1.72
-0.98
-36.30%
NUTX
Clinigence Holdings
197.51
107.88
120.36%
DH
Definitive Healthcare Corp
0.70
-2.82
-80.17%
OMDA
Omada Health, Inc.
24.99
5.93
31.11%
HealthStream Corporate Events
Business Operations and StrategyStock BuybackDividendsFinancial Disclosures
HealthStream Posts Strong Q2 Results and Raises Guidance
Positive
Aug 3, 2026
On August 3, 2026, HealthStream reported strong second-quarter 2026 results, with revenue rising 12.5% year over year to a record $83.7 million, driven by subscription and professional services growth and contributions from recent acquisitions. Op...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
HealthStream Elevates Collier to COO, Enhances Executive Incentives
Positive
May 8, 2026
HealthStream has promoted Michael M. Collier to chief operating officer and executive vice president, as disclosed in a May 4, 2026 release on first-quarter results, expanding his remit to lead enterprise operations, from customer experience and c...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.