HealthStream (HSTM) AI Stock Analysis

• Market Cap: $846.47M
• Dividend Yield: 0.45%
• Average Volume (3M): 217.83K
• Price to Earnings (P/E): 44.4
• Beta (1Y): 0.55
• Revenue Growth: 3.36%
• EPS Growth: 7.51%
• Country: US
• Employees: 1,083
• Sector: Healthcare
• Sector Strength: 44
• Industry: Medical - Healthcare Information Services
• EPS (TTM): 0.14
• Shares Outstanding: 30,525,267
• 10 Day Avg. Volume: 231,718
• 30 Day Avg. Volume: 217,834
• PEG Ratio: 0.60
• Price to Book (P/B): 2.28
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 29.18
• Enterprise Value/Market Cap: 0.87
• Enterprise Value/Revenue: 0.64
• Enterprise Value/Gross Profit: 3.82
• Enterprise Value/Ebitda: 2.97
• 1Y Price Target: $29.00
• Price Target Upside: 4.58% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 64 Neutral
• Price Target: $29.00 ▲(4.58%Upside)

HealthStream's overall stock score reflects a company with solid financial performance and stability, albeit facing technical challenges and valuation concerns. While recent earnings and corporate developments indicate potential for future growth, the high P/E ratio and bearish technical indicators suggest cautious optimism. The company's ability to navigate macroeconomic headwinds and execute operational efficiencies will be critical in improving its stock performance.

Positive Factors

Business Expansion

HealthStream has secured one of the largest deals in its history, a $14 million 5-year bundled deal with a large health system.

Platform Strategy

The hStream platform strategy aims to improve interoperability and extensibility, enhancing cross-selling opportunities and increasing penetration of existing accounts.

Negative Factors

Customer Retention

There were technology scaling issues with the CredentialStream product, impacting service quality and delaying implementations, potentially damaging customer relationships.

Financial Performance

HealthStream reported results that fell below consensus estimates, with a decline in revenue growth and adjusted EBITDA missing both analyst and consensus forecasts.

Legacy Products

The presence of legacy products continues to inhibit growth and reduces visibility, with a persistent risk of legacy customers leaving for non-HSTM solutions.

HealthStream Business Overview & Revenue Model

Company Description

HealthStream, Inc. provides workforce and provider solutions for healthcare organizations in the United States. It operates through two segments, Workforce Solutions and Provider Solutions. The company offers workforce solutions, including software-as-a-service (SaaS) based services and subscription-based solutions to meet the range of its clinical development, talent management, training, education, certification, scheduling, competency assessment, performance appraisal, and other needs, as well as implementation and account management services. It also provides applications for learning, performance appraisal, competency management, disclosure management, clinical assessment and development, simulation-based education, quality management, and industry training. In addition, the company offers VerityStream that delivers enterprise-class solutions to transform the healthcare provider experience for ambulatory surgery centers, urgent care facilities, clinics, medical groups, and other healthcare organizations; EchoCredentialing and MSOW platforms that manage medical staff credentialing, enrollment, and privileging processes for hospitals; and EchoOneApp, a provider enrollment platform for medical groups. Further, it provides CredentialMyDoc, a credentialing and enrollment SaaS solution for medical groups and surgery centers; CredentialStream, a SaaS-based provider credentialing, privileging, and enrollment solution; and NurseGrid Mobile for nurse managers. The company offers its solutions in healthcare industry companies that include private, not-for-profit, and government entities, as well as pharmaceutical and medical device companies through direct sales teams. HealthStream, Inc. was incorporated in 1990 and is headquartered in Nashville, Tennessee.

How the Company Makes Money

HealthStream generates revenue primarily through the sale of its subscription-based software-as-a-service (SaaS) solutions. The company's key revenue streams include licensing fees for its learning management systems, sales of proprietary and third-party training content, and fees for its credentialing and compliance solutions. Additionally, HealthStream partners with healthcare organizations to deliver customized training programs, which can also serve as a source of revenue. The company's focus on recurring revenue models, such as subscriptions and long-term contracts, provides a steady and predictable income stream. Significant partnerships with healthcare providers and educational institutions further support its market presence and financial performance.

HealthStream Financial Statement Overview

Summary

HealthStream's financial statements collectively portray a company with strong growth potential and financial stability. The robust income statement reflects consistent revenue and profit growth, while a solid balance sheet underscores financial health with low leverage. Cash flows are strong, though some volatility in non-operational cash activities requires monitoring. Overall, HealthStream is well-positioned within its industry, with a promising outlook contingent on maintaining operational efficiencies and financial prudence.

Income Statement

HealthStream's income statement demonstrates solid growth and profitability. The TTM revenue shows a consistent upward trend, with a noticeable revenue growth from 2022 to 2024. The gross profit margin remains healthy, indicating efficient cost management. Net profit and EBITDA margins have improved over time, reflecting enhanced operational efficiency. However, the margin expansion slowed slightly in the most recent period, suggesting a need for ongoing cost control.

Balance Sheet

The balance sheet is robust, characterized by a strong equity base and low leverage. The company's debt-to-equity ratio is low, which limits financial risk and enhances financial stability. The equity ratio is high, indicating a solid financial foundation. Return on equity is improving, signaling effective use of shareholders' funds. The balance sheet's strength is a key competitive advantage, though attention should be paid to maintaining this low leverage as the company grows.

Cash Flow

Cash flow statements reveal a positive trajectory in free cash flow growth, supported by strong operating cash flows. The operating cash flow to net income ratio is favorable, suggesting effective cash conversion. Free cash flow has expanded over the periods, underscoring the company's capacity to generate cash post capital expenditures. However, fluctuations in investing and financing cash flows suggest potential volatility in non-operational activities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	292.37M	291.65M	279.06M	266.83M	256.71M	244.83M
Gross Profit	193.56M	193.71M	184.04M	175.68M	165.68M	155.49M
EBITDA	62.43M	62.53M	59.59M	53.53M	44.87M	46.01M
Net Income	19.11M	20.01M	15.21M	12.09M	5.84M	14.09M
Balance Sheet
Total Assets	524.04M	510.77M	499.94M	497.74M	486.75M	500.31M
Cash, Cash Equivalents and Short-Term Investments	113.32M	97.22M	71.13M	53.91M	51.95M	46.49M
Total Debt	16.64M	17.37M	20.25M	23.32M	26.18M	28.48M
Total Liabilities	161.23M	151.41M	159.19M	163.68M	147.73M	166.25M
Stockholders Equity	362.81M	359.36M	340.75M	334.06M	339.02M	334.06M
Cash Flow
Free Cash Flow	42.36M	29.52M	35.96M	26.09M	17.04M	17.07M
Operating Cash Flow	63.80M	57.66M	63.97M	51.19M	42.38M	35.87M
Investing Cash Flow	-34.10M	-33.97M	-56.60M	-28.39M	-25.72M	-110.41M
Financing Cash Flow	-4.82M	-4.52M	-13.04M	-23.70M	-6.21M	-20.49M

HealthStream Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 27.73
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HSTM, the sentiment is Neutral. The current price of 27.73 is above the 20-day moving average (MA) of 27.66, below the 50-day MA of 28.90, and below the 200-day MA of 30.72, indicating a neutral trend. The MACD of -0.36 indicates Negative momentum. The RSI at 48.36 is Neutral, neither overbought nor oversold. The STOCH value of 86.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HSTM.

HealthStream Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PHR	71 Outperform	$1.70B	―	-15.97%	―	16.29%	66.01%
HSTM	64 Neutral	$846.47M	44.38	5.40%	0.45%	3.36%	7.51%
HCAT	61 Neutral	$281.89M	―	-19.80%	―	4.88%	37.87%
EVH	60 Neutral	$1.37B	―	-10.99%	―	10.24%	2.63%
ACCD	58 Neutral	$575.59M	―	-48.23%	―	14.99%	-35.83%
TDOC	54 Neutral	$1.48B	―	-54.49%	―	-2.54%	-322.03%
Sector *	49 Neutral	AU$2.48B	4.18	-64.25%	2.84%	36.51%	13.13%

HealthStream Corporate Events

HealthStream Holds Annual Shareholder Meeting on May 29

On May 29, 2025, HealthStream, Inc. held its annual meeting of shareholders where three directors were elected to the board for a three-year term. Additionally, shareholders ratified the appointment of Ernst & Young LLP as the independent accounting firm for 2025 and approved a non-binding advisory resolution on executive compensation.

The most recent analyst rating on (HSTM) stock is a Buy with a $36.00 price target. To see the full list of analyst forecasts on HealthStream stock, see the HSTM Stock Forecast page.

HealthStream Announces $25 Million Share Buyback Program

On May 8, 2025, HealthStream announced that its Board of Directors has approved a new share repurchase program, allowing the company to buy back up to $25 million of its outstanding common stock. This initiative, which will run until May 31, 2026, or until the maximum amount is spent, is subject to market conditions and regulatory requirements, and can be suspended or discontinued at any time.

HealthStream Reports Q1 2025 Financial Results

On May 5, 2025, HealthStream announced its financial results for the first quarter of 2025, revealing a slight increase in revenue to $73.5 million, but a decline in operating income and net income compared to the same period in 2024. The company attributed these results to investments in platform and SaaS applications, as well as changes in revenue mix. The Board declared a quarterly cash dividend of $0.031 per share. Additionally, HealthStream updated its financial guidance for 2025, reflecting macroeconomic challenges and technology scaling issues, while maintaining a strong sales pipeline.