Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

HealthEquity (HQY) Q4 Earnings, Revenues Beat Estimates

By Zacks Investment ResearchStock MarketsMar 16, 2021 01:42AM ET
www.investing.com/analysis/healthequity-hqy-q4-earnings-revenues-beat-estimates-200567655
HealthEquity (HQY) Q4 Earnings, Revenues Beat Estimates
By Zacks Investment Research   |  Mar 16, 2021 01:42AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

HealthEquity, Inc. HQY reported adjusted earnings per share (EPS) of 42 cents for fourth-quarter fiscal 2021, which beat the Zacks Consensus Estimate of 41 cents by 2.4%. Also, the bottom line grew 5% on a year-over-year basis.

For fiscal 2021, adjusted EPS came in at $1.67, in line with the Zacks Consensus Estimate. However, the bottom line dipped 0.6% on a year-over-year basis.

Revenues in Detail

For the fiscal fourth quarter, the company generated revenues of $188.2 million, outpacing the Zacks Consensus Estimate by 1.4%. However, the top line fell 6.4% from the prior-year quarter.

For fiscal 2021, revenues summed $733.6 million, outpacing the Zacks Consensus Estimate by 0.4%. Also the figure grew 37.9% year over year.

HSA Details

As of Jan 31, 2021, the total number of Health Savings Accounts (HSA) for which HealthEquity served as a non-bank custodian (HSA members), came in at 5.8 million, up 8% year over year.

Additionally, total Active HSA assets were $14.3 billion, up 24% year over year. Total HSA Accounts as of Jan 31, 2021 were 12.8 million including 7 million Consumer Direct Benefits (CDB).

Segmental Performance

Service Revenues: Revenues of $111.3 million were down 8.9% from the year-ago figure.

Custodial Revenues: Revenues slid 1.6% year over year to $48.6 million.

Interchange Revenues: Revenues fell 4.7% year over year to $28.3 million.

Margin Details

HealthEquity generated gross profit of $100.9 million, down 11.2% from the year-ago quarter. Gross margin was 53.6% of net revenues, down 287 basis points (bps) year over year.

Adjusted operating profit in the fiscal fourth quarter was $32.2 million, down 28.1% year over year. Adjusted operating margin was 17.1% in the period, contracting 517 bps year over year.

Financial Position

The company exited the fiscal fourth quarter with cash and cash equivalents of $328.8 million compared with $191.7 million at the end of the year-ago period.

Cumulative cash flow from operating activities in the quarter totaled $181.6 million, up from $105 million in the year-ago period.

Full-Fiscal View

For fiscal 2022, revenues are projected within $750-$760 million. The Zacks Consensus Estimate for the same is pegged at $753.6 million.

Adjusted earnings per share are expected within $1.37-$1.42. The Zacks Consensus Estimate for the same stands at $1.69.

Summing Up

HealthEquity exited fourth-quarter fiscal 2021 on a strong note. Notably, solid growth in HSAs and custodial assets bolstered the top line. In addition to HSA, the company offers health reimbursement arrangement to regional employers.HealthEquity continued to benefit from the acquisition of WageWorks, which was completed in August 2019.

However, the company witnessed a weak segmental performance in the quarter under review. A significant drop in adjusted operating and gross margin raises a concern. The company also faces stiff competition in the Medical Services market. HealthEquity is required to comply with the strict treasury regulations formulated by the Internal Revenue Service (IRS).

Zacks Rank and Key Picks

HealthEquity currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader medical space that already announced quarterly results are Hologic (NASDAQ:HOLX), Inc. HOLX, Abbott Laboratories (NYSE:ABT) ABT and Hill-Rom (NYSE:HRC) Holdings, Inc. HRC, each presently carrying a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Hologic reported first-quarter fiscal 2021 adjusted EPS of $2.86, which surpassed the Zacks Consensus Estimate by 33.6%.

Abbott reported fourth-quarter 2020 adjusted EPS of $1.45, which surpassed the Zacks Consensus Estimate by 6.6%. Further, fourth-quarter worldwide sales of $10.7 billion outpaced the consensus mark by 7.9%.

Hill-Rom reported first-quarter fiscal 2021 adjusted EPS of $1.53, beating the Zacks Consensus Estimate by 45.7%. Revenues of $741.1 million surpassed the consensus mark by 13.2%.

Zacks Top 10 Stocks for 2021

In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?

Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.

AccessZacks Top 10 Stocks for 2021 today >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Hologic, Inc. (HOLX): Free Stock Analysis Report

Abbott Laboratories (ABT): Free Stock Analysis Report

HillRom Holdings, Inc. (HRC): Free Stock Analysis Report

HealthEquity, Inc. (HQY): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research
HealthEquity (HQY) Q4 Earnings, Revenues Beat Estimates
 

Related Articles

HealthEquity (HQY) Q4 Earnings, Revenues Beat Estimates

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email