Premier (PINC) AI Stock Analysis

• Market Cap: $1.86B
• Dividend Yield: 3.72%
• Average Volume (3M): 1.59M
• Price to Earnings (P/E): 39.5
• Beta (1Y): 0.30
• Revenue Growth: -17.69%
• EPS Growth: -10.24%
• Country: US
• Employees: 2,900
• Sector: Healthcare
• Sector Strength: 59
• Industry: Medical - Healthcare Information Services
• EPS (TTM): 0.44
• Shares Outstanding: 82,342,440
• 10 Day Avg. Volume: 1,343,711
• 30 Day Avg. Volume: 1,586,327
• PEG Ratio: -0.56
• Price to Book (P/B): 1.41
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.07
• Enterprise Value/Market Cap: 1.96
• Enterprise Value/Revenue: 0.74
• Enterprise Value/Gross Profit: 4.72
• Enterprise Value/Ebitda: 4.61
• 1Y Price Target: $21.83
• Price Target Upside: -3.28% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 7

• Rating: 76 Outperform
• Price Target: $26.00 ▲(15.20%Upside)

Premier's overall stock score of 76 reflects a mix of strong technical momentum and positive strategic initiatives, despite challenges in financial performance. The company's efforts to enhance shareholder value through stock repurchase programs and strategic partnerships bolster investor confidence. However, high valuation and operational challenges remain areas to watch.

Positive Factors

Contract Negotiations

Member fee share renegotiations are progressing faster than anticipated, with over 75% of negotiations completed by the end of 3Q and over 80% expected to be completed by the end of the fiscal year.

Earnings

Premier reported a F3Q beat and lifted FY25 Adj EBITDA guidance modestly.

Shareholder Returns

PINC rewards shareholders with a 3.7% dividend yield and another $200M share repurchase under its $1B authorization.

Negative Factors

Fee Pressure

Net GPO admin fee revenue declined 10% y/y as the negotiated increases in the share to its hospital members more than offset growth in gross admin fee revenue.

Performance Services

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

Revenue Decline

Net revenue declined 8% y/y and rose 10% q/q to $255M (ex Contigo Health which will be fully divested by year end).

Premier Business Overview & Revenue Model

Company Description

Premier, Inc., together with its subsidiaries, operates as a healthcare improvement company in the United States. It operates in two segments, Supply Chain Services and Performance Services. The Supply Chain Services segment offers its members with an access to a range of products and services, including medical and surgical products, pharmaceuticals, laboratory supplies, capital equipment, information technology, facilities and construction, and food and nutritional products, as well as purchased services, such as clinical engineering and workforce solutions. This segment also provides the ASCENDrive programs for members to receive group purchasing programs, tiers, and prices; SURPASS Performance Group services; STOCKD, an e-commerce platform; PROVIDEGX program, which identifies supply sources for drugs that are on or may be at risk of being added to the national drug shortage list, or that are vulnerable to pricing volatility, as well as direct sourcing business; SaaS informatics products; supply chain co-management services; purchased services contracts; direct sourcing solutions; and supply chain resiliency programs. The Performance Services segment provides technology and services platform with offerings that help optimize performance in three main areas, including clinical intelligence, margin improvement, and value-based care under the PINC AI brand; third party administrator services and management of health benefit programs under the Contigo Health brand; and digital invoicing and payables services that offers financial support services to healthcare product suppliers and service providers under the Remitra brand. The company also provides services to other businesses, including food service, schools, and universities. Premier, Inc. was incorporated in 2013 and is headquartered in Charlotte, North Carolina.

How the Company Makes Money

Premier, Inc. generates revenue primarily through its group purchasing organization (GPO) and performance services. The GPO aggregates purchasing volume from member hospitals and healthcare providers to negotiate discounts with manufacturers, earning fees based on the volume of products purchased. Additionally, the company offers supply chain co-management solutions that contribute to its revenue. In the Performance Services segment, Premier provides subscription-based data analytics and consulting services that help healthcare providers enhance quality, safety, and cost management, further adding to its earnings. Strategic partnerships, alliances, and technology-driven solutions also play a crucial role in the company's revenue generation.

Premier Financial Statement Overview

Summary

Premier's financials reveal a stable yet challenged performance. While strong operational efficiency and prudent financial management are evident, declining revenues and net margins suggest pressure in market dynamics. Continuous focus on cash flow improvements and cost management will be crucial to sustain financial health.

Income Statement

The company's revenue has shown fluctuations, with a notable decline from 2021 to 2025. The gross profit margin has remained relatively stable around 60-65%, indicating efficient production management. However, the net profit margin has decreased over the years, reflecting higher costs or reduced pricing power. The TTM data shows a concerning drop in net income, suggesting potential financial pressures.

Balance Sheet

Premier has maintained a strong equity position, with the equity ratio improving from 2020 to 2025. The debt-to-equity ratio has fluctuated but remains manageable, indicating prudent financial leverage. The reduction in cash and cash equivalents could pose liquidity risks, but overall, the balance sheet is solid with a consistent increase in stockholders' equity.

Cash Flow

The company has demonstrated strong free cash flow generation, with a positive growth trajectory. Operating cash flow consistently exceeds net income, which is a positive indicator of cash-generating efficiency. However, the decline in free cash flow in TTM suggests caution for future cash management.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
1.10B	1.35B	1.34B	1.43B	1.72B	1.30B
	Gross Profit
770.82M	888.01M	896.29M	885.04M	837.33M	866.80M
	EBIT
78.91M	127.97M	242.09M	260.07M	256.92M	373.62M
	EBITDA
189.51M	256.97M	398.26M	467.15M	383.67M	547.83M
	Net Income Common Stockholders
62.51M	119.54M	175.03M	265.87M	287.52M	291.13M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
71.33M	125.15M	89.79M	86.14M	129.14M	99.30M
	Total Assets
3.07B	3.40B	3.37B	3.36B	3.52B	2.95B
	Total Debt
283.32M	113.70M	440.33M	487.29M	521.67M	137.19M
	Net Debt
211.99M	-11.45M	350.54M	401.14M	392.53M	37.89M
	Total Liabilities
1.55B	1.44B	1.04B	1.11B	1.29B	2.81B
	Stockholders Equity
1.52B	1.96B	2.33B	2.25B	2.23B	139.26M
Cash Flow		Free Cash Flow
325.27M	215.37M	362.24M	356.79M	318.53M	255.13M
	Operating Cash Flow
399.73M	296.56M	444.54M	444.23M	407.40M	349.52M
	Investing Cash Flow
-54.06M	-68.47M	-273.62M	-139.44M	-174.57M	-222.32M
	Financing Cash Flow
-336.13M	-192.72M	-167.27M	-347.79M	-203.00M	-168.95M

Premier Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 22.57
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

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 22.57 is below the 20-day moving average (MA) of 22.87, above the 50-day MA of 21.38, and above the 200-day MA of 20.30, indicating a neutral trend. The MACD of 0.32 indicates Positive momentum. The RSI at 53.67 is Neutral, neither overbought nor oversold. The STOCH value of 18.57 is Positive, 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
PINC	76 Outperform	$1.86B	39.53	6.05%	3.72%	-17.69%	-10.24%
OMCL	67 Neutral	$1.37B	64.37	1.73%	―	3.00%	―
GDRX	67 Neutral	$1.56B	58.82	4.43%	―	4.35%	―
DH	57 Neutral	$534.14M	―	-86.36%	―	-3.04%	-152.59%
SOPH	55 Neutral	$191.81M	―	-60.75%	―	4.66%	11.33%
EVH	54 Neutral	$970.90M	―	-10.99%	―	10.24%	2.63%
Sector *	54 Neutral	$5.38B	3.27	-45.10%	3.30%	16.81%	0.02%

Premier Corporate Events

Premier Reports Q3 2025 Financial Results Improvement

On May 6, 2025, Premier, Inc. announced its financial results for the third quarter of fiscal year 2025, which ended on March 31, 2025. The company reported a total net revenue of $261.4 million, a 9% decrease from the previous year but a 9% increase from the previous quarter. Net income from continuing operations was $27.6 million, a significant improvement from a net loss in the same period last year. Despite a decrease in adjusted EBITDA and EPS compared to the prior year, both metrics showed substantial growth from the second quarter of fiscal 2025. The company attributed its sequential revenue and profitability growth to better-than-expected performance in its Supply Chain Services segment. Premier also increased its adjusted EBITDA and EPS guidance while reaffirming its revenue guidance midpoint, highlighting the positive impact of its share repurchase program.