Earnings Beat: HealthEquity, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

A week ago, HealthEquity, Inc. (NASDAQ:HQY) came out with a strong set of first-quarter numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of US$288m, some 3.5% above estimates, and statutory earnings per share (EPS) coming in at US$0.33, 66% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for HealthEquity

Following the latest results, HealthEquity's 13 analysts are now forecasting revenues of US$1.17b in 2025. This would be a notable 12% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 27% to US$1.18. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.16b and earnings per share (EPS) of US$1.03 in 2025. Although the revenue estimates have not really changed, we can see there's been a substantial gain in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The consensus price target was unchanged at US$104, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic HealthEquity analyst has a price target of US$115 per share, while the most pessimistic values it at US$92.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of HealthEquity'shistorical trends, as the 16% annualised revenue growth to the end of 2025 is roughly in line with the 17% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 6.6% per year. So although HealthEquity is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around HealthEquity's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$104, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for HealthEquity going out to 2027, and you can see them free on our platform here..

It might also be worth considering whether HealthEquity's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.