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HealthStream
(NASDAQ:HSTM)
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Rating:79Outperform
Price Target:
$32.00
▲(47.26% Upside)
Action:Reiterated
Date:05/09/26
HSTM scores well primarily on financial quality (low leverage, strong cash generation, and solid margins) and a positive earnings update with reaffirmed guidance and strong backlog/RPO visibility. Technicals are supportive but not emphatically long-term bullish given proximity to the 200-day average. The main constraint on the score is valuation, with a mid-to-high P/E and modest dividend yield.
Positive Factors
Conservative balance sheet
Very low leverage and a strong cash position provide durable financial flexibility. With virtually no long-term debt and an untapped credit line, the company can fund acquisitions, R&D, buybacks, or weather downturns without forcing dilutive financing, preserving strategic optionality over 2–6 months.
Negative Factors
Legacy product migration drag
Declines in legacy credentialing/scheduling revenue reflect migration-related churn that can pressure near-term top-line growth. Migrating long-term customers is strategic but creates temporary revenue gaps and prolongs the pace at which new solution adoption fully offsets attrition.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet
Very low leverage and a strong cash position provide durable financial flexibility. With virtually no long-term debt and an untapped credit line, the company can fund acquisitions, R&D, buybacks, or weather downturns without forcing dilutive financing, preserving strategic optionality over 2–6 months.
Read all positive factors
HealthStream Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks revenue down by product and service lines (for example, subscription software, professional services, and content licensing) to show which parts of the business drive growth and profits. A larger recurring subscription mix suggests more predictable cash flow and higher margins, while reliance on one-time or services revenue can mean lower margin potential and less revenue visibility. Shifts in these shares highlight where the company is gaining traction, facing competitive pressure, or exposed to customer concentration or healthcare spending cycles.
Breaks revenue down by product and service lines (for example, subscription software, professional services, and content licensing) to show which parts of the business drive growth and profits. A larger recurring subscription mix suggests more predictable cash flow and higher margins, while reliance on one-time or services revenue can mean lower margin potential and less revenue visibility. Shifts in these shares highlight where the company is gaining traction, facing competitive pressure, or exposed to customer concentration or healthcare spending cycles.
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The Fly
The FlyHealthStream (HSTM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$823.28M
Dividend Yield0.52%
Average Volume (3M)215.55K
Price to Earnings (P/E)42.1
Beta (1Y)0.61
Revenue Growth6.64%
EPS Growth6.54%
CountryUS
Employees1,083
SectorHealthcare
Sector Strength45
IndustryMedical - Healthcare Information Services
Share Statistics
EPS (TTM)0.67
Shares Outstanding29,215,187
10 Day Avg. Volume287,357
30 Day Avg. Volume215,553
Financial Highlights & Ratios
PEG Ratio-4.99
Price to Book (P/B)1.96
Price to Sales (P/S)2.28
P/FCF Ratio11.61
Enterprise Value/Market Cap0.88
Enterprise Value/Revenue2.33
Enterprise Value/Gross Profit3.58
Enterprise Value/Ebitda10.37
Forecast
1Y Price Target
$32.00Price Target Upside47.26% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
EPS Forecast (FY)0.73
Revenue Forecast (FY)$327.28M
HealthStream Business Overview & Revenue Model
Company Description
HealthStream, Inc., established in 1990 and headquartered in Nashville, Tennessee, delivers specialized workforce and provider solutions to healthcare organizations throughout the United States. Its operations are divided into two primary segments...
How the Company Makes Money
HealthStream generates revenue primarily by selling subscription-based software and content to healthcare organizations. A key driver is recurring revenue from cloud-delivered platforms used for workforce learning and development (training adminis...
HealthStream Earnings Call Summary
Earnings Call Date:May 04, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 27, 2026
Earnings Call Sentiment Positive
The call highlighted robust top-line and margin expansion (record revenue and adjusted EBITDA), strong product-level growth (CredentialStream, ShiftWizard, Competency Suite), successful acquisition integrations, a healthy balance sheet and cash generation, and reaffirmed full-year guidance. Management also outlined deliberate, accelerated investments (career networks, My Clinical Exchange infrastructure, sales hiring, and AI) which will modestly increase operating spend and may temper near-term margin cadence. Legacy product migration and potential margin pressure from cloud initiatives are the primary operational risks noted, but they are balanced against strong organic momentum and strategic investments that aim to expand addressable markets and long-term growth.Positive Updates
Record Revenue and Adjusted EBITDA
Revenue of $81.2M in Q1 2026, up 10.5% year-over-year; adjusted EBITDA reached a record $20.1M, up 24.1% year-over-year, with adjusted EBITDA margin improving to 24.8% from 22% a year ago.
Negative Updates
Minor Receivables and DSO Change
Days sales outstanding modestly increased to 39 days from 37 days a year ago (target 40–45), which slightly affected operating cash flows and is a point to monitor.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Revenue and Adjusted EBITDA
Revenue of $81.2M in Q1 2026, up 10.5% year-over-year; adjusted EBITDA reached a record $20.1M, up 24.1% year-over-year, with adjusted EBITDA margin improving to 24.8% from 22% a year ago.
Read all positive updates
Company Guidance
HealthStream reaffirmed its 2026 guidance, targeting consolidated revenue of $323.0–$330.0 million, net income of $20.4–$22.8 million, adjusted EBITDA of $73.0–$77.0 million, and capital expenditures of $31–$34 million; for Q2 management expects revenue growth of approximately 9.5% and an adjusted EBITDA margin of about 23%. The company noted $687 million of remaining performance obligations (with ~39% expected to convert to revenue in 12 months and ~67% in 24 months), ended Q1 with $66.5 million of cash and investments, reported Q1 free cash flow of $19.7 million and operating cash flow of $27.1 million, and carries no long-term debt with an untapped line of credit. Q1 actions included $7.5 million of share repurchases (under two Board-authorized programs), a newly-declared quarterly dividend of $0.035 per share payable May 29, and repurchases continuing into Q2; management also warned the guidance excludes the impact of any future acquisitions/dispositions, changes in fair value of non‑marketable equity or contingent consideration, or asset impairments and highlighted planned Q2 operating investments (higher labor, marketing, and technology spend).HealthStream Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
90
Very Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 311.78M | 304.06M | 291.65M | 279.06M | 266.83M | 256.71M |
| Gross Profit | 202.30M | 196.85M | 193.71M | 184.04M | 175.68M | 165.68M |
| EBITDA | 69.88M | 66.70M | 66.05M | 59.59M | 53.53M | 44.58M |
| Net Income | 19.92M | 18.34M | 20.01M | 15.21M | 12.09M | 5.84M |
Balance Sheet | ||||||
| Total Assets | 527.44M | 520.37M | 510.77M | 499.94M | 497.74M | 486.75M |
| Cash, Cash Equivalents and Short-Term Investments | 66.50M | 57.00M | 97.22M | 71.13M | 53.91M | 51.95M |
| Total Debt | 14.07M | 14.68M | 20.17M | 20.25M | 23.32M | 29.11M |
| Total Liabilities | 175.45M | 166.35M | 151.41M | 159.19M | 163.68M | 147.73M |
| Stockholders Equity | 351.99M | 354.02M | 359.36M | 340.75M | 334.06M | 339.02M |
Cash Flow | ||||||
| Free Cash Flow | 60.01M | 59.63M | 29.52M | 61.77M | 49.42M | 38.97M |
| Operating Cash Flow | 63.38M | 63.32M | 57.66M | 63.97M | 51.19M | 42.38M |
| Investing Cash Flow | -49.42M | -50.35M | -33.97M | -56.60M | -28.39M | -25.72M |
| Financing Cash Flow | -42.59M | -36.27M | -4.52M | -13.04M | -23.70M | -6.21M |
HealthStream Technical Analysis
Positive
21.73
Price Trends
24.93
Positive
22.93
Positive
23.61
Positive
Market Momentum
1.01
Negative
64.30
Neutral
59.48
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HSTM, the sentiment is Positive. The current price of 21.73 is below the 20-day moving average (MA) of 26.82, below the 50-day MA of 24.93, and below the 200-day MA of 23.61, indicating a bullish trend. The MACD of 1.01 indicates Negative momentum. The RSI at 64.30 is Neutral, neither overbought nor oversold. The STOCH value of 59.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HSTM.
HealthStream Risk Analysis
HealthStream disclosed 38 risk factors in its most recent earnings report. HealthStream reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
HealthStream Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $823.28M | 42.10 | 5.67% | 0.52% | 6.64% | 6.54% | |
74 Outperform | $1.24B | 13.64 | 31.39% | ― | 40.95% | 4.15% | |
70 Outperform | $1.37B | -205.32 | -2.81% | ― | 49.36% | 83.76% | |
53 Neutral | $629.89M | -1.20 | -77.89% | ― | -21.26% | -290.08% | |
52 Neutral | $162.57M | -0.60 | -99.78% | ― | -2.83% | -223.32% | |
52 Neutral | $116.71M | -0.49 | -67.07% | ― | -3.89% | 63.03% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
HSTM
HealthStream
28.02
1.57
5.93%
EVH
Evolent Health
5.63
-5.55
-49.64%
HCAT
Health Catalyst
2.24
-1.65
-42.42%
NUTX
Clinigence Holdings
183.36
68.75
59.99%
DH
Definitive Healthcare Corp
0.80
-3.12
-79.57%
OMDA
Omada Health, Inc.
23.55
5.88
33.28%
HealthStream Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
HealthStream Elevates Collier to COO, Enhances Executive Incentives
Positive
May 8, 2026
HealthStream has promoted Michael M. Collier to chief operating officer and executive vice president, as disclosed in a May 4, 2026 release on first-quarter results, expanding his remit to lead enterprise operations, from customer experience and c...
Business Operations and StrategyExecutive/Board ChangesStock BuybackDividendsFinancial Disclosures
HealthStream Posts Record Q1 2026 Results, Reaffirms Outlook
Positive
May 4, 2026
On May 4, 2026, HealthStream reported record first-quarter 2026 revenue of $81.2 million, up 10.5% year over year, with operating income rising 71.6% to $7.5 million and net income climbing 36.4% to $5.9 million, or $0.20 per diluted share, driven...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.