On Thursday, Piper Sandler adjusted its outlook for Health Catalyst Inc. (NASDAQ:HCAT), reducing the price target to $14 from the previous $15, while retaining an Overweight rating on the stock.
This revision follows Health Catalyst's reiteration of its full-year 2024 guidance, which includes projected revenues ranging from $304 million to $312 million, adjusted EBITDA between $24 million and $26 million, mid-teen net new Data Operating System (DOS) additions, and a dollar-based retention rate of 104% to 110%.
The firm's updated financial model for Health Catalyst now forecasts FY24 revenues at approximately $306.1 million, with adjusted EBITDA at $24.6 million. The Overweight rating suggests that Piper Sandler continues to view Health Catalyst's stock as a good investment, despite the slight decrease in the price target.
Health Catalyst's affirmation of its FY24 outlook provides investors with a measure of consistency in the company's performance expectations. The company's focus on revenue growth and customer retention, as indicated by the guidance, remains a pivotal aspect of its business strategy.
The revised price target of $14 reflects a modest adjustment based on the latest quarterly results and guidance provided by Health Catalyst. The Overweight rating indicates that the investment firm believes the company's stock will outperform the average return of the stocks that Piper Sandler covers over the next 12 to 18 months.
Investors and stakeholders in Health Catalyst Inc. can consider this updated information as they assess the company's current financial position and future potential in the healthcare data and analytics market. The company's commitment to maintaining its forecasted financial outcomes for the upcoming year is a significant point of reference for ongoing and prospective investment considerations.
In other recent news, Health Catalyst reported an increase in its Q1 2024 financial results with total revenue of $74.7 million and an adjusted EBITDA of $3.4 million. Despite a slight decrease in adjusted gross margin, the company remains in a strong cash position, having ended Q1 with $327.8 million in cash, cash equivalents, and short-term investments.
The company anticipates Q2 2024 revenue to be between $73.5 million and $76.5 million, and full-year revenue to be between $304 million and $312 million.
Health Catalyst is actively exploring potential acquisitions and has recently expanded its partnership with Saudi German Health to improve health outcomes in the United Arab Emirates. The company's technology revenue remained flat, while professional services revenue grew by 4%. Health Catalyst is utilizing AI to enhance its offerings and expects improved health system operating margins to drive bookings and top-line growth in 2025.
Despite facing challenges in shifting its portfolio during financial pressures in 2022 and 2023, Health Catalyst remains confident in the utilization of its solutions.
InvestingPro Insights
Health Catalyst Inc. (NASDAQ:HCAT) presents an interesting financial landscape, as reflected in the latest data. With a market capitalization of $395.53 million, the company's valuation mirrors its position in the competitive healthcare analytics market. Notably, Health Catalyst holds more cash than debt on its balance sheet, a positive sign for investors looking for a company with a solid financial foundation. Moreover, analysts are optimistic about the company's future, predicting that Health Catalyst will become profitable this year, which could be a pivotal turning point for the company's earnings trajectory.
Despite recent market volatility, Health Catalyst's stock has demonstrated resilience with a 2.92% increase in price total return over the past week. This contrasts with a broader downward trend over the last year, where the stock has seen a -45.35% return. Investors might also find solace in the company's revenue growth, which has increased by 5.24% over the last twelve months as of Q1 2024, indicating a steady upward trajectory in its core business operations.
For those considering a deeper dive into Health Catalyst's financials, there are additional InvestingPro Tips available that could provide further insights into the company's performance and potential. With a current fair value estimate at $9.1 USD, as per InvestingPro's analysis, prospective investors might find an opportunity to capitalize on the stock's potential upside. For access to these valuable tips and more, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. There are 5 more InvestingPro Tips listed on InvestingPro that could help you make an informed decision about Health Catalyst.
As Health Catalyst continues to navigate the dynamic healthcare sector, these financial metrics and expert analyses could prove crucial for investors looking to understand the company's current standing and future prospects.
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