HealthEquity (NASDAQ:HQY) shares traded 5% higher in pre-market Tuesday after the company reported better-than-expected Q1 results.
HealthEquity posted a profit per share of $0.50 on revenue of $244.4 million, higher than the analyst estimate for earnings of $0.41 per share on sales of $239.39M.
As a result, the company raised its full-year forecast so it now expects EPS of $1.88-1.97 on revenue of $975-985M. It had previously expected EPS of $1.74-1.87 on revenue of $960-975M.
Analysts were expecting full-year EPS of $1.75 on revenue of $967.4M.
"We are raising our outlook for the full year based on this strong first quarter performance, which also enabled our early payment of $50 million of variable-rate debt even as we continue to invest in drivers of future growth, including a remarkable service experience for our partners, clients, and members," HQY said.
Wells Fargo analysts reiterated the Best Idea designation on HQY as they expect 2025 estimates to move higher.
“We also think margins & revenue could see positive catalysts unrelated to rates,” analysts said.
BTIG analysts said the company delivered “excellent” results.
“Current macroeconomic trends are working in HQY's favor which we expect to drive momentum throughout the rest of the year and into F2025E. The headwinds from the COVID-era are now tailwinds; we maintain our Buy rating on HQY.”