Premier (PINC) AI Stock Analysis

• Market Cap: $1.78B
• Dividend Yield: 4.3%
• Average Volume (3M): 1.57M
• Price to Earnings (P/E): 16.4
• Beta (1Y): 0.39
• Revenue Growth: -10.24%
• EPS Growth: -106.48%
• Country: US
• Employees: 2,900
• Sector: Healthcare
• Sector Strength: 79
• Industry: Medical - Healthcare Information Services
• EPS (TTM): -0.10
• Shares Outstanding: 91,307,396
• 10 Day Avg. Volume: 1,715,243
• 30 Day Avg. Volume: 1,572,750
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.43
• Price to Cash Flow (P/CF): 3.80
• P/FCF Ratio: 3.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $19.10
• Price Target Upside: -1.75% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 6

Premier, Inc. demonstrates a mixed outlook. While the balance sheet and cash flow are strong, indicating financial resilience, the income statement reveals profitability challenges. Technical indicators are bearish, with the stock trading below key moving averages. Valuation is mixed due to a negative P/E ratio but a high dividend yield. Recent earnings call and corporate events highlight strategic efforts to stabilize and grow, suggesting potential for future improvement despite current hurdles.

Positive Factors

Fee Stabilization

Fee share headwinds appear to be stabilizing, a positive for Supply Chain.

Share Repurchase Program

The shares continue to be supported by a $1 billion repurchase authorization (nearly $600M completed to date).

Supply Chain Services

Supply Chain Services performance came in better than consensus expectations in the midst of the ongoing recontracting efforts.

Negative Factors

Consulting Services Demand

Quarterly performance was negatively impacted by lower demand in consulting services as well as unfavorable product mix.

Performance Services Challenges

Performance Services results were an area of weakness in the quarter, with lower guidance also showing the challenges in the business currently.

Revenue Fee Share Rates

PINC continues to face headwinds from rising revenue fee share rates and that trend should continue into FY26 where the company expects the blended rate to increase to the high-60% range from the low-60% range.

Premier Business Overview & Revenue Model

Company Description

Premier, Inc. (PINC) is a leading healthcare improvement company that unites an alliance of approximately 4,400 U.S. hospitals and health systems and more than 225,000 other providers and organizations. The company operates in the healthcare sector and offers a comprehensive suite of services, including supply chain services, healthcare informatics, and performance improvement consulting. Premier aims to transform healthcare by providing data-driven solutions and technologies to improve efficiency and outcomes in the healthcare industry.

How the Company Makes Money

Premier, Inc. generates revenue through a diversified business model that includes multiple revenue streams. The company earns money primarily through its supply chain services, where it leverages group purchasing organization (GPO) contracts to negotiate lower prices for medical supplies and pharmaceuticals for its members. Additionally, Premier provides performance services that include informatics, consulting, and software-as-a-service (SaaS) solutions to help healthcare organizations improve quality, efficiency, and safety. The company also benefits from strategic partnerships and collaborations with healthcare providers and suppliers, enhancing its market reach and creating value-added services that contribute to its earnings.

Premier Financial Statement Overview

Summary

Overall, Premier shows a mixed financial performance. While the income statement indicates recent profitability issues with negative net profit margins, the balance sheet remains strong with low leverage and good equity ratios. The cash flow statement is a bright spot, with strong cash generation capabilities. Continued focus on revenue stabilization and cost management could enhance future financial performance.

Income Statement

The company has shown a declining revenue trend over the past years, with a significant drop in TTM revenue compared to prior years. The gross profit margin has remained relatively stable, but the net profit margin has turned negative in the TTM, indicating recent profitability challenges. However, the company previously maintained positive EBIT and EBITDA margins, showing potential for operational improvements.

Balance Sheet

The balance sheet shows a strong equity position with a favorable debt-to-equity ratio. The company has reduced total debt significantly over the past few years, which enhances financial stability. The equity ratio is healthy, reflecting a solid asset base funded by equity. However, the reduction in stockholders' equity in the TTM could be a concern if it continues.

Cash Flow

The company has consistently generated positive operating cash flow, with a strong operating cash flow to net income ratio, especially in the TTM. Free cash flow remains robust, although the growth rate has fluctuated. The ability to maintain strong cash flows amidst declining revenues is a positive sign of financial resilience.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
1.18B	1.35B	1.34B	1.43B	1.72B	1.30B
	Gross Profit
785.70M	840.74M	896.29M	885.04M	837.33M	866.80M
	EBIT
-32.49M	127.97M	242.09M	260.07M	256.92M	373.62M
	EBITDA
83.50M	256.97M	398.26M	467.15M	383.67M	547.83M
	Net Income Common Stockholders
-4.75M	119.54M	175.03M	265.87M	287.52M	291.13M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
233.86M	125.15M	89.79M	86.14M	129.14M	99.30M
	Total Assets
1.10B	3.40B	3.37B	3.36B	3.52B	2.95B
	Total Debt
40.19M	113.70M	440.33M	487.29M	521.67M	137.19M
	Net Debt
-117.87M	-11.45M	350.54M	401.14M	392.53M	37.89M
	Total Liabilities
4.58B	1.44B	1.04B	1.11B	1.29B	2.81B
	Stockholders Equity
-3.48B	1.96B	2.33B	2.25B	2.23B	139.26M
Cash Flow		Free Cash Flow
368.50M	215.37M	362.24M	356.79M	318.53M	255.13M
	Operating Cash Flow
440.50M	296.56M	444.54M	444.23M	407.40M	349.52M
	Investing Cash Flow
-59.27M	-68.47M	-273.62M	-139.44M	-174.57M	-222.32M
	Financing Cash Flow
-666.39M	-192.72M	-167.27M	-347.79M	-203.00M	-168.95M

Premier Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 19.44
• 50DMA: Positive
• 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 PINC, the sentiment is Positive. The current price of 19.44 is above the 20-day moving average (MA) of 18.84, above the 50-day MA of 19.04, and below the 200-day MA of 19.82, indicating a neutral trend. The MACD of 0.14 indicates Negative momentum. The RSI at 61.50 is Neutral, neither overbought nor oversold. The STOCH value of 91.07 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PINC.

Premier Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HQY	69 Neutral	$7.18B	76.10	4.66%	―	20.03%	71.43%
HSTM	67 Neutral	$970.55M	48.69	5.72%	0.36%	4.51%	32.28%
HCSG	64 Neutral	$744.43M	18.99	8.25%	―	2.65%	3.34%
PINC	63 Neutral	$1.78B	16.39	1.76%	4.30%	-10.24%	-106.48%
OMCL	60 Neutral	$1.59B	124.63	1.03%	―	-3.04%	―
Sector *	48 Neutral	$6.86B	1.11	-50.22%	2.47%	16.71%	1.53%

Premier Corporate Events

Premier Announces $200 Million Stock Repurchase Agreement

On February 14, 2025, Premier, Inc. entered into agreements with JPMorgan Chase Bank to repurchase $200 million of its Class A common stock. This transaction is part of a $1 billion share repurchase plan approved by Premier’s Board in February 2024. The company funded the repurchase using its credit facility, with the final settlement expected by the first quarter of the 2026 fiscal year. This initiative signifies Premier’s strategic use of capital, potentially enhancing shareholder value and reflecting confidence in its market positioning.

Premier Reports Q2 Loss, Reaffirms Revenue Guidance

On February 4, 2025, Premier, Inc. announced its fiscal-year 2025 second-quarter financial results for the period ended December 31, 2024. The company reported a GAAP net loss from continuing operations of $45.8 million, influenced by a significant impairment charge. Despite this, Premier reaffirmed its midpoints for fiscal revenue and adjusted EBITDA guidance, and increased its adjusted earnings per share guidance. The results also highlight a $200 million share repurchase, underscoring the company’s commitment to returning capital to shareholders. The report reflects Premier’s ongoing strategic adjustments, including the divestiture of the S2S Global business and the continued inclusion of contributions from Contigo Health, amid challenges in its Performance Services segment.

Premier’s Strategic Repurchase and Upcoming Conference

In January 2025, Premier, Inc. announced the completion of an additional $200 million repurchase of its Class A Common Stock, part of a $1.0 billion share repurchase authorization approved in February 2024. This marks a total of $600 million in repurchases to date, following a $400 million accelerated share repurchase program. This move underscores Premier’s strategic capital allocation aimed at creating value for stockholders. The company is also set to present at the J.P. Morgan Healthcare Conference on January 14, 2025, where it will discuss its growth strategies and positioning in the healthcare industry.