HealthEquity (NASDAQ:HQY) Releases Earnings Results, Beats Estimates By $0.05 EPS

HealthEquity (NASDAQ:HQY) released its earnings results on Thursday. The company reported $1.24 earnings per share for the quarter, beating analysts’ consensus estimates of $1.19 by $0.05, FiscalAI reports. HealthEquity had a net margin of 17.25% and a return on equity of 14.75%. The firm had revenue of $350.73 million during the quarter, compared to the consensus estimate of $349.22 million. HealthEquity’s quarterly revenue was up 95.5% compared to the same quarter last year. HealthEquity updated its FY 2027 guidance to 4.660-4.730 EPS.

Here are the key takeaways from HealthEquity’s conference call:

• HealthEquity raised fiscal 2027 guidance after record second-quarter results, including 8% year-over-year revenue growth, a 48% adjusted EBITDA margin, and adjusted EBITDA growth of 11% to $167 million.
• HSA momentum remained strong, with total HSA assets up 14%, total HSAs up 8%, and new HSAs from sales up 24% year over year; retention is expected to remain above 90%.
• Member engagement and operating leverage are improving, with monthly active app users up 62% to 1.4 million, investing HSA members up 20%, and human-handled calls down 25% as AI automation lowers service costs.
• Marketplace activity is accelerating but remains immaterial to overall revenue; Health Savings Days generated 500,000 unique visitors in one week, while management is still testing categories, marketing, and conversion strategies.
• Management noted ongoing competitive pressure and headline service-price erosion, meaning future margin gains will need to be balanced against sharing cost savings with clients through lower administrative fees.

HealthEquity Stock Down 10.6%

HealthEquity stock opened at $93.39 on Friday. HealthEquity has a 1-year low of $72.76 and a 1-year high of $107.62. The firm has a market capitalization of $7.81 billion, a price-to-earnings ratio of 34.98, a P/E/G ratio of 1.76 and a beta of 0.21. The company has a current ratio of 3.44, a quick ratio of 3.44 and a debt-to-equity ratio of 0.46. The firm has a 50 day simple moving average of $97.93 and a 200 day simple moving average of $87.81.

Wall Street Analysts Forecast Growth

HQY has been the topic of several research analyst reports. KeyCorp reiterated an “overweight” rating on shares of HealthEquity in a research note on Tuesday, May 26th. BTIG Research raised their target price on HealthEquity from $110.00 to $115.00 and gave the stock a “buy” rating in a research report on Friday, July 24th. Citizens Jmp boosted their target price on HealthEquity from $110.00 to $111.00 and gave the company a “market outperform” rating in a research note on Monday, June 1st. Wall Street Zen raised HealthEquity from a “hold” rating to a “buy” rating in a research report on Saturday, August 22nd. Finally, Barrington Research reiterated an “outperform” rating and set a $110.00 price target on shares of HealthEquity in a research note on Friday, May 22nd. Eleven research analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, HealthEquity presently has a consensus rating of “Moderate Buy” and an average target price of $110.93.

Insiders Place Their Bets

In other HealthEquity news, EVP Michael Henry Fiore sold 2,354 shares of the stock in a transaction on Friday, July 10th. The stock was sold at an average price of $95.00, for a total transaction of $223,630.00. Following the sale, the executive vice president owned 52,244 shares in the company, valued at $4,963,180. This represents a 4.31% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Adrian T. Dillon sold 7,632 shares of the firm’s stock in a transaction on Tuesday, August 25th. The stock was sold at an average price of $104.61, for a total value of $798,383.52. Following the completion of the transaction, the director directly owned 62,395 shares of the company’s stock, valued at $6,527,140.95. The trade was a 10.90% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 12,456 shares of company stock worth $1,256,664 in the last three months. Insiders own 1.60% of the company’s stock.

Institutional Inflows and Outflows

Several large investors have recently added to or reduced their stakes in the stock. Fiduciary Trust Co increased its stake in HealthEquity by 3.4% in the 3rd quarter. Fiduciary Trust Co now owns 3,669 shares of the company’s stock worth $348,000 after acquiring an additional 120 shares during the last quarter. Larson Financial Group LLC boosted its position in shares of HealthEquity by 24.4% during the 3rd quarter. Larson Financial Group LLC now owns 628 shares of the company’s stock valued at $60,000 after acquiring an additional 123 shares during the last quarter. Merit Financial Group LLC grew its holdings in shares of HealthEquity by 8.9% during the third quarter. Merit Financial Group LLC now owns 2,112 shares of the company’s stock worth $200,000 after purchasing an additional 172 shares in the last quarter. Parallel Advisors LLC increased its position in shares of HealthEquity by 14.3% in the fourth quarter. Parallel Advisors LLC now owns 1,387 shares of the company’s stock worth $127,000 after purchasing an additional 173 shares during the last quarter. Finally, Smartleaf Asset Management LLC increased its position in shares of HealthEquity by 51.9% in the fourth quarter. Smartleaf Asset Management LLC now owns 793 shares of the company’s stock worth $73,000 after purchasing an additional 271 shares during the last quarter. Institutional investors own 99.55% of the company’s stock.

Key Headlines Impacting HealthEquity

Here are the key news stories impacting HealthEquity this week:

• Positive Sentiment: HealthEquity reported quarterly EPS of $1.24, ahead of the $1.19 consensus estimate, while revenue reached $350.7 million, slightly above expectations. Revenue increased 95.5% year over year. HealthEquity Q2 Earnings and Revenues Top Estimates
• Positive Sentiment: Profitability improved, with net income rising 10% to $65.6 million and adjusted EBITDA increasing 11% to $167 million. Net and adjusted EBITDA margins also expanded, indicating operating leverage. HealthEquity Second-Quarter Financial Results
• Positive Sentiment: Management raised fiscal 2027 EPS guidance to $4.66–$4.73, above the $4.56 analyst consensus. Record HSA assets of $37.9 billion further support the company’s long-term growth prospects. HealthEquity Raises Fiscal 2027 Guidance
• Neutral Sentiment: Fiscal 2027 revenue guidance was approximately $1.4 billion, broadly in line with expectations. This suggests the guidance upgrade was driven mainly by improved earnings outlook rather than a meaningful increase in projected sales.
• Negative Sentiment: Director Adrian T. Dillon sold 7,632 shares for approximately $798,000, reducing his holdings by 10.9%. The sale was made under a pre-arranged Rule 10b5-1 plan, which limits its bearish signal, but it may still contribute to near-term selling pressure. HealthEquity Director Stock Sale
• Negative Sentiment: HQY trades at roughly 35 times earnings after approaching its 52-week high. Investors may be taking profits or demanding stronger upside after the earnings beat, particularly because revenue guidance was not raised significantly.

About HealthEquity

HealthEquity, Inc (NASDAQ: HQY) is a leading administrator of consumer-directed health accounts and related benefit solutions in the United States. Founded in 2002 and headquartered in Draper, Utah, the company specializes in health savings accounts (HSAs) and offers complementary services such as flexible spending accounts (FSAs), health reimbursement arrangements (HRAs), COBRA administration and commuter benefits. Through its technology-driven platform, HealthEquity enables employers, health plans and individuals to streamline account management, improve cost transparency and encourage more informed healthcare spending.

Serving millions of members across all 50 states, HealthEquity leverages an open-architecture ecosystem that integrates with health plans, payroll providers and financial institutions.