HealthEquity, Inc
HQY
$84.20
+2.75%
HealthEquity, Inc. is a leading provider of technology-enabled services that empower consumers to make healthcare saving and spending decisions, operating within the Medical - Healthcare Information Services industry. The company is a dominant player in the Health Savings Account (HSA) and consumer-directed benefits administration space, managing tax-advantaged accounts like HSAs, FSAs, and HRAs for employers and individuals. The current investor narrative centers on the company's execution of a margin expansion story, as evidenced by a significant year-over-year improvement in profitability, and its ability to sustain revenue growth in a competitive and regulated benefits landscape.…
HQY
HealthEquity, Inc
$84.20
HQY 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on HealthEquity, Inc's 12-month outlook, with a consensus price target around $109.46 and implied upside of +30.0% versus the current price.
Average Target
$109.46
2 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
2
covering this stock
Price Range
$67 - $109
Analyst target range
Analyst coverage for HQY appears limited, with only two analysts providing estimates for revenue and EPS, though the institutional ratings data shows ongoing coverage from several major firms. The consensus sentiment is overwhelmingly bullish, as evidenced by recent institutional actions from Deutsche Bank (Buy), JP Morgan (Overweight), Barrington Research (Outperform), and RBC Capital (Outperform) all maintaining positive ratings. The notable exception is a downgrade to Sell from Goldman Sachs in January 2026, which introduces a note of caution amidst the prevailing optimism. The average analyst revenue estimate for the coming period is $1.618 billion, with a range from $1.597 billion to $1.641 billion, indicating a relatively tight spread and high conviction in the top-line forecast. Similarly, the EPS estimate average is $6.20, with a low of $6.10 and a high of $6.31. The lack of a published consensus price target in the data prevents a precise upside calculation, but the maintenance of Outperform and Overweight ratings by multiple firms in March 2026 suggests analysts see fundamental value at current levels. The tight estimate ranges for both sales and EPS signal that while coverage may be limited, the analysts who do follow the stock have a firm grasp on its near-term trajectory, reducing the uncertainty typically associated with limited coverage.
HQY Technical Analysis
The stock is in a pronounced downtrend, having declined 4.59% over the past year, which starkly contrasts with the S&P 500's 22.2% gain, resulting in a severe relative strength deficit of -26.79%. With a current price of $84.67, the stock is trading at approximately 73% of its 52-week range ($72.76 to $116.65), indicating it is much closer to its yearly lows than highs, which may signal a value opportunity but also reflects persistent negative momentum and investor skepticism. Recent short-term momentum shows a modest 5.27% gain over the past month, which is a positive divergence from the longer-term downtrend and outperforms the S&P 500's -4.28% return, suggesting a potential stabilization or relief rally after the significant 7.03% decline over the past three months. The key technical support level is the 52-week low of $72.76, while the nearest resistance is the 52-week high of $116.65, representing a wide trading band that underscores the stock's volatility over the period. A decisive break below the $72.76 support could trigger a new leg down, whereas a sustained move above recent highs near $105 would be necessary to signal a trend reversal. The stock exhibits low systematic risk with a beta of 0.262, meaning it is approximately 74% less volatile than the broader market, which is unusual for a growth-oriented name and may indicate it is trading more on idiosyncratic, company-specific factors than macro sentiment. The stock's price action has been highly volatile, as evidenced by a maximum drawdown of -35.25% from its 52-week high, highlighting significant downside risk experienced by investors. This volatility, coupled with the low beta, suggests the stock's movements are driven by fundamental execution and sector-specific news rather than broader market gyrations. The recent positive 1-month relative strength of 9.55% indicates the stock is beginning to find its footing, but it remains deep in negative territory on longer timeframes, requiring sustained buying pressure to confirm a true reversal.
Beta
0.26
0.26x market volatility
Max Drawdown
-35.3%
Largest decline past year
52-Week Range
$73-$117
Price range past year
Annual Return
+1.3%
Cumulative gain past year
| Period | HQY Return | S&P 500 |
|---|---|---|
| 1m | +7.3% | +0.4% |
| 3m | -10.6% | -2.0% |
| 6m | -7.0% | +4.1% |
| 1y | +1.3% | +23.9% |
| ytd | -7.5% | -0.3% |
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HQY Fundamental Analysis
Revenue growth remains positive but has shown some quarterly volatility; the most recent Q4 FY2026 revenue was $334.59 million, representing a solid 7.3% year-over-year growth. However, examining the sequential quarterly revenue trend from the provided data ($330.84M in Q1, $325.84M in Q2, $322.16M in Q3, to $334.59M in Q4) reveals a pattern of slight deceleration followed by a re-acceleration in the final quarter, suggesting underlying demand is stable but not explosive. Segment data indicates the 'Financial Service, Other' segment is the largest revenue contributor at $161.4 million, though specific growth rates for each segment are not available to pinpoint the exact drivers. Profitability has improved dramatically, with the company reporting net income of $49.74 million in Q4 FY2026, a substantial increase from $26.37 million in the year-ago quarter. Gross margin expanded impressively to 92.4% in Q4, up from 60.7% a year prior, though this quarter's figure appears anomalously high compared to the more normalized ~62-63% gross margins in the preceding quarters of FY2026, which may be due to accounting or one-time items. The operating margin was a healthy 20.1% in Q4, and the net margin for the period was 14.9%, indicating the company is translating revenue growth effectively to the bottom line. The balance sheet is strong, with a robust current ratio of 3.27 and a manageable debt-to-equity ratio of 0.48, reflecting a conservative capital structure. The company is a significant generator of free cash flow, with trailing twelve-month FCF of $439.07 million, providing ample internal resources to fund operations, share repurchases, and potential acquisitions without relying on external financing. Return on equity (ROE) stands at 10.2%, which, while not exceptionally high, shows capital is being deployed profitably, and the company's cash conversion cycle is negative at -9.75 days, indicating efficient working capital management.
Quarterly Revenue
$334586000.0B
2026-01
Revenue YoY Growth
+0.07%
YoY Comparison
Gross Margin
+0.92%
Latest Quarter
Free Cash Flow
$439068000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is HQY Overvalued?
Given that Net Income is positive ($49.74M in latest quarter), the primary valuation metric selected is the Price-to-Earnings (PE) ratio. The trailing PE ratio is 34.29x, while the forward PE is significantly lower at 15.86x, indicating the market expects a substantial near-term earnings growth, which aligns with the analyst consensus EPS estimate of $6.20 for the coming period. The large gap between trailing and forward multiples suggests the market is pricing in a normalization or acceleration of profitability from recent levels. Compared to sector averages, the valuation presents a mixed picture; specific industry average multiples are not provided in the data, but the stock's Price-to-Sales (PS) ratio of 5.62 and EV-to-Sales of 5.97 are key metrics for a services company. The forward PE of 15.86x appears reasonable if the company can deliver on its earnings growth trajectory, especially considering its PEG ratio of 0.27 (based on trailing metrics) implies the stock is undervalued relative to its growth rate, though this figure should be interpreted with caution due to potential earnings volatility. Historically, the stock's current trailing PE of 34.29x is below its own recent historical range observed in the provided data, which has seen quarterly PE ratios fluctuate from as low as 34.44x to as high as 325.85x over the past several years, largely driven by earnings volatility. The current multiple sits near the lower end of its recent band (excluding extreme outliers), suggesting the market's expectations are tempered relative to past optimism, potentially offering a more attractive entry point if the fundamental improvement proves sustainable.
PE
34.3x
Latest Quarter
vs. Historical
High-End
5-Year PE Range -6166x~326x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
25.0x
Enterprise Value Multiple

