Post Earnings Coverage as HealthEquity Revenue Soared 42%

Upcoming AWS Coverage on Veeva Systems Post-Earnings Results

LONDON, UK / ACCESSWIRE / December 13, 2016 / Active Wall St. announces its post-earnings coverage on HealthEquity, Inc. (NASDAQ: HQY). The Company reported its third quarter ended October 31 2016 (Q3 FY17) financial results on December 06, 2016. The provider of services for managing health care outperformed Wall Street’s revenue expectations, while also meeting earnings forecasts. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of HealthEquity’s competitors within the Healthcare Information Services space, Veeva Systems Inc. (NYSE: VEEV), reported on November 22, 2016, results for its fiscal third quarter ended October 31, 2016. AWS will be initiating a research report on Veeva Systems in the coming days.

Today, AWS is promoting its earnings coverage on HQY; touching on VEEV. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=HQY

http://www.activewallst.com/registration-3/?symbol=VEEV

Earnings Reviewed

For the three months ended on October 31, 2016, HealthEquity reported revenue of $43.4 million compared to $30.6 million for Q3 FY16; an increase of 42%. During the reported quarter, HealthEquity’s revenue consisted of Service revenue which increased 24% to $18.8 million from the year ago period. HealthEquity’s custodial revenue soared 64% on a y-o-y basis to $15.0 million. The company’s Interchange revenue advanced 55% to $9.6 million for Q3 FY17 compared to Q3 FY16. The company’s revenue topped analysts’ expectations of $43.3 million.

For Q3 FY17, HealthEquity posted gross profit of $25.9 million compared to $17.7 million in Q3 FY16, for a gross margin level of 60% in the reported quarter versus 58% in the year ago comparable period. The company’s Q3 FY17 operating expenses totaled $16.8 million, or 39% of revenue, compared to $11.4 million, or 37% of revenue, in Q3 FY16. HealthEquity’s income from operations surged 43% on a y-o-y basis to $9 million in the reported quarter, and generated an operating margin of 21%.

During Q3 FY17, HealthEquity posted adjusted EBITDA of $14.5 million, registering growth of 47% compared to $9.9 million for Q3 FY16. The company’s adjusted EBITDA was 34% of revenue for the reported quarter compared to 32% for the year ago corresponding period.

HealthEquity posted net income of $6.0 million for Q3 FY17 compared to $4.1 million for Q3 FY16. The company’s net income per diluted share was $0.10 for Q3 FY17 compared to net income per diluted share of $0.07 in the year earlier same quarter. On an adjusted basis, the company reported net income per diluted share of $0.12, meeting analysts’ forecasts of $0.12 per share.

HSA Member and AUM metrics

HealthEquity noted that the total number of health savings accounts (HSAs) for which the company serves as a non-bank custodian (“HSA Members”) as of October 31, 2016, were 2.4 million, an increase of 48% from 1.6 million as of October 31, 2015. HealthEquity’s total assets under management (“AUM”) at the end of Q3 FY17 totaled $4.3 billion, surging by 59% on a y-o-y basis. The company’s AUM comprised of cash AUM of $3.7 billion, an increase of 61% compared to Q3 FY16 and Investment AUM of $570.6 million, an increase of 48% on a y-o-y basis. Over the last 12 months, HealthEquity has grown AUM by $1.6 billion.

Balance Sheet

As of October 31, 2016, HealthEquity had $165.7 million of cash, cash equivalents, and marketable securities and no outstanding debt, compared to $123.8 million in cash, cash equivalents, and marketable securities and no outstanding debt as of January 31, 2016.

Outlook

For FY17, HealthEquity reiterated its previously provided guidance. The company is projecting to generate revenue in the range of $174.0 million to $178.0 million. HealthEquity s forecasting to deliver net income in the range of $23.0 million to $25.0 million, resulting in a net income per diluted share range of $0.38 to $0.42 (based on an estimated 60.0 million weighted-average shares outstanding). The company is projecting adjusted EBITDA in the band of $59.0 million to $62.0 million.

Stock Performance

On Monday, the stock closed the trading session at $40.99, slightly up 0.12% from its previous closing price of $40.94. A total volume of 471.43 thousand shares have exchanged hands. HealthEquity’s stock price rallied 6.91% in the last month, 21.89% in the past three months, and 40.81% in the previous six months. Furthermore, on a year to date basis, the stock soared 63.50%. HealthEquity’s stock is trading at a P/E of 96.00.

Active Wall Street:

Active Wall Street (AWS) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and micro-cap stocks. AWS has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.

AWS has not been compensated; directly or indirectly; for producing or publishing this document.

PRESS RELEASE PROCEDURES:

The non-sponsored content contained herein has been prepared by a writer (the “Author”) and is fact checked and reviewed by a third party research service company (the “Reviewer”) represented by a credentialed financial analyst, for further information on analyst credentials, please email info@activewallst.com. Rohit Tuli, a CFA® charterholder (the “Sponsor”), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by AWS. AWS is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.

NO WARRANTY

AWS, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. AWS, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, AWS, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.

NOT AN OFFERING

This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither AWS nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://www.activewallst.com/disclaimer/.

CONTACT

For any questions, inquiries, or comments reach out to us directly. If you’re a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:

Email: info@activewallst.com
Phone number: 1-858-257-3144

Office Address: 3rd floor, 207 Regent Street, London, W1B 3HH, United Kingdom

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

SOURCE: Active Wall Street

ReleaseID: 450943