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Waystar Holding Corp. (WAY)
NASDAQ:WAY
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Waystar Holding Corp.
(NASDAQ:WAY)
67Neutral
Positive Factors
Competitive Positioning
Waystar is the preferred vendor among peers, indicating strong competitive positioning.
Financial Performance
Waystar reported a strong end to 2024, exceeding Street estimates by a significant margin on both revenue/EBITDA, with volume-based revenue driving a large share of the beat.
Revenue Growth
WAY is on pace to deliver a 15% revenue CAGR between 2021 and 2025E, and has delivered a consistent gross revenue retention rate of ~97%.
Negative Factors
Health System Spending
There is greater caution on health system spending expected over the next year.
Increased Competition
Downside risks include increased competition and client win slowdown/losses, high level of indebtedness, and selling pressure from current PE/VC owners.
Market Expectations
The first time 2025 guidance is likely below investor expectations.
Waystar Holding Corp. (WAY) vs. S&P 500 (SPY)
Market Cap
$6.32B
Dividend YieldN/A
Average Volume (3M)2.03M
Price to Earnings (P/E)―
Beta (1Y)0.88
Revenue Growth19.28%
EPS Growth61.17%
CountryUS
Employees1,500
SectorGeneral
Sector StrengthN/A
IndustryInformation Technology Services
Share Statistics
EPS (TTM)-0.12
Shares Outstanding172,151,840
10 Day Avg. Volume1,462,979
30 Day Avg. Volume2,027,557
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)14.44
Price to Cash Flow (P/CF)20.50
P/FCF Ratio22.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$48.71Price Target Upside33.64% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
Waystar Holding Corp. Business Overview & Revenue Model
Company DescriptionWaystar Holding Corp. develops a cloud-based software solution for healthcare payments. Its platform offers financial clearance, patient financial care, claim and payment management, denial prevention and recovery, revenue capture, and analytics and reporting solutions. The company primarily serves healthcare industry. Waystar Holding Corp. was founded in 2017 and is based in Lehi, Utah.
How the Company Makes Moneynull
Waystar Holding Corp. Financial Statement Overview
Summary
Waystar Holding Corp. shows robust revenue growth and strong balance sheet management with improved equity ratios. However, ongoing net losses and challenges in achieving operational profitability remain concerns, despite solid cash flow generation.Income Statement
Waystar Holding Corp. has shown significant revenue growth with a 19.27% increase from 2023 to 2024. However, the company has been consistently reporting net losses, although the loss has decreased from $51.33M in 2023 to $19.13M in 2024. Gross profit margin is strong, indicating efficient cost management, but net profit margin remains negative. EBIT and EBITDA margins have decreased, reflecting challenges in operational efficiency.65
Positive
Balance Sheet
The company's balance sheet is quite strong with a high equity ratio of 67.30% in 2024, indicating a solid financial foundation. The debt-to-equity ratio has significantly improved to 0.01 in 2024, showing minimal reliance on debt. Return on equity remains negative due to net losses, but the improvement in equity position is a positive sign.72
Positive
Cash Flow
Waystar's free cash flow has shown substantial growth, with a large increase from $29.94M in 2023 to $142.5M in 2024. The operating cash flow to net income ratio indicates effective cash generation despite reported losses. The company has managed to generate positive free cash flow, which is a strong indicator of financial health.75
Positive
| Breakdown | |||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|
| Income Statement | Total Revenue | ||
| 943.55M | 791.01M | 704.87M | 578.57M | Gross Profit |
| 627.82M | 541.24M | 306.82M | 250.74M | EBIT |
| 123.72M | 142.08M | 104.34M | 71.60M | EBITDA |
| 310.36M | 318.58M | 287.50M | 247.66M | Net Income Common Stockholders |
| -19.13M | -51.33M | -51.45M | -47.12M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||
| 182.13M | 45.43M | 72.64M | 54.50M | Total Assets |
| 4.58B | 4.58B | 4.81B | 4.89B | Total Debt |
| 42.59M | 2.25B | 2.26B | 2.30B | Net Debt |
| -139.55M | 2.21B | 2.19B | 2.24B | Total Liabilities |
| 1.50B | 2.53B | 2.70B | 2.77B | Stockholders Equity |
| 3.08B | 2.05B | 2.11B | 2.12B |
| Cash Flow | Free Cash Flow | ||
| 142.50M | 29.94M | 85.20M | 91.86M | Operating Cash Flow |
| 169.77M | 51.46M | 102.63M | 106.41M | Investing Cash Flow |
| -27.27M | -61.52M | -17.43M | -444.33M | Financing Cash Flow |
| 16.65M | -17.15M | -67.06M | 331.50M |
Waystar Holding Corp. Technical Analysis
Negative
36.45
Price Trends
39.24
Negative
37.56
Negative
31.87
Positive
Market Momentum
-0.58
Negative
45.70
Neutral
69.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WAY, the sentiment is Negative. The current price of 36.45 is below the 20-day moving average (MA) of 37.08, below the 50-day MA of 39.24, and above the 200-day MA of 31.87, indicating a neutral trend. The MACD of -0.58 indicates Negative momentum. The RSI at 45.70 is Neutral, neither overbought nor oversold. The STOCH value of 69.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WAY.
Waystar Holding Corp. Risk Analysis
Waystar Holding Corp. disclosed 58 risk factors in its most recent earnings report. Waystar Holding Corp. 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
Waystar Holding Corp. Peers Comparison
Overall Rating
UnderperformOutperform
Sector (55)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $4.87B | ― | -2.14% | 3.30% | 11.17% | ― | |
67 Neutral | $6.32B | ― | -0.75% | ― | 19.28% | 61.17% | |
61 Neutral | $9.53B | ― | -14.87% | ― | 242.24% | -221.02% | |
60 Neutral | $2.99B | ― | -1.62% | ― | 27.65% | 86.89% | |
55 Neutral | $4.02B | -11.16 | -12.81% | 5.53% | 21.89% | -64.83% | |
50 Neutral | $7.07B | ― | -1252.79% | ― | 30.38% | -195.58% | |
49 Neutral | $11.83B | ― | 218.28% | ― | 41.19% | -220.59% |
* General Sector Average
Performance Comparison
WAY
Waystar Holding Corp.
36.45
14.35
64.93%
BTSG
BrightSpring Health Services, Inc.
16.60
6.09
57.94%
AHR
American Healthcare REIT, Inc.
30.61
17.97
142.17%
ALAB
Astera Labs, Inc.
58.96
-5.53
-8.57%
RBRK
Rubrik, Inc. Class A
61.61
23.61
62.13%
TEM
Tempus AI, Inc. Class A
40.45
3.97
10.88%
Waystar Holding Corp. Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: -19.63% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
Waystar demonstrated strong financial performance and strategic achievements, such as record revenue growth, successful IPO, and innovative AI solutions. Although there was a slight concern about potential volume growth slowdown, the overall performance was robust, and the company is well-positioned for future growth.Highlights
Record Revenue Growth
Waystar achieved a revenue of $244 million in Q4 2024, marking an 18% year-over-year increase. The full year revenue reached $944 million, representing a 19% growth from the previous year.
Successful IPO
Waystar completed its IPO in June, raising approximately $1 billion, which bolstered its financial position for continued growth and innovation.
High Net Revenue Retention
Net revenue retention stood at 110% in Q4, at the high end of Waystar's historical range over the past ten quarters.
Strong Adjusted EBITDA Performance
Adjusted EBITDA for Q4 was $100 million, a 16% increase year-over-year, with full-year margins at 40.6%.
Innovation in AI and Automation
Launch of Waystar AltitudeAI, with capabilities like Altitude Create, improved denial recovery efficiency, saving clients an average of 16 minutes per appeal package.
Recognition and Awards
Waystar was recognized as one of America's most trusted companies by Forbes and named one of the best workplaces in healthcare by Fortune.
Lowlights
Potential Volume Growth Slowdown
Expectations for volume growth in 2025 are back to the historical 1% to 2% range, compared to higher growth rates seen in 2024.
Higher Revenue Mix from Provider Solutions
Despite growth, the revenue mix from provider solutions, which accounts for 70% of total revenue, slightly affected overall margins.
Company Guidance
In the fourth quarter of fiscal year 2024, Waystar reported a revenue of $244 million, reflecting an 18% year-over-year increase, which contributed to a full-year revenue of $944 million, or a 19% year-over-year growth. The company achieved a net revenue retention rate of 110%, and the number of clients generating more than $100,000 in trailing 12-month revenue increased by 15% to 1,203. Adjusted EBITDA for the quarter was $100 million, a 16% increase year-over-year, with an adjusted EBITDA margin of 41%, resulting in a full-year margin of 40.6%. Unlevered free cash flow for the quarter was $80 million, bringing the fiscal 2024 total to $265 million, with a conversion rate of 69% from adjusted EBITDA. Looking ahead to fiscal year 2025, Waystar provided guidance of $1 billion to $1.16 billion in revenue, representing 7% growth, or 10% on a normalized basis, with an adjusted EBITDA range of $399 million to $407 million and a continued target of approximately 40% adjusted EBITDA margin.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.