Definitive Healthcare Corp (DH) AI Stock Analysis

• Market Cap: $408.92M
• Dividend Yield: N/A
• Average Volume (3M): 334.39K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.74
• Revenue Growth: -5.24%
• EPS Growth: 23.59%
• Country: US
• Employees: 782
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Healthcare Information Services
• EPS (TTM): 0.07
• Shares Outstanding: 104,086,210
• 10 Day Avg. Volume: 379,313
• 30 Day Avg. Volume: 334,391
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.27
• Enterprise Value/Revenue: 2.11
• Enterprise Value/Gross Profit: 2.77
• Enterprise Value/Ebitda: -1.30
• 1Y Price Target: $4.66
• Price Target Upside: 55.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 46 Neutral
• Price Target: $3.50 ▲(17.06% Upside)

Definitive Healthcare Corp's overall stock score is primarily impacted by its financial performance challenges, including negative net income and declining revenue growth. Technical analysis indicates bearish trends, and valuation metrics are unattractive with a negative P/E ratio. However, the earnings call provided some positive insights, such as exceeding financial guidance and improvements in customer retention, which slightly offset the negative aspects.

Positive Factors

Strong Gross Profit Margin

A robust gross profit margin indicates effective cost management and pricing power, providing a buffer against revenue fluctuations and supporting long-term profitability.

Successful Data Partnership

Strategic data partnerships enhance product offerings and market reach, supporting revenue growth and competitive positioning over the long term.

Improvement in Renewal Rates

Improved renewal rates reflect customer satisfaction and loyalty, which are critical for sustaining revenue streams and reducing churn over time.

Negative Factors

Declining Revenue Growth

A decline in revenue growth can indicate challenges in market demand or competitive pressures, potentially impacting long-term financial health and strategic initiatives.

Challenges in Life Sciences Segment

Ongoing challenges in a key segment like life sciences can hinder overall growth prospects and limit opportunities for upsell and cross-sell, affecting future revenue potential.

Negative Net Income

Sustained negative net income suggests difficulties in achieving profitability, which can strain resources and limit investment in growth initiatives over the long term.

Definitive Healthcare Corp Business Overview & Revenue Model

Company Description

Definitive Healthcare Corp., together with its subsidiaries, provides healthcare commercial intelligence in the United States. Its solutions provide information on healthcare providers and their activities to help its customers in the area ranging from product development to go-to-market planning, and sales and marketing execution. The company's platform offers 16 intelligence modules that cover functional areas, such as sales, marketing, clinical research and product development, strategy, talent acquisition, and physician network management. It serves biopharmaceutical and medical device companies, healthcare information technology companies, and healthcare providers; and other diversified companies comprising staffing and commercial real estate companies, financial institutions, and other organizations in the healthcare ecosystem. Definitive Healthcare Corp. was founded in 2011 and is headquartered in Framingham, Massachusetts.

How the Company Makes Money

Definitive Healthcare Corp generates revenue primarily through subscription-based services that give clients access to its extensive healthcare data and analytics platform. The company offers various subscription tiers, allowing clients to choose packages that best fit their needs. Key revenue streams include licensing fees for its data products, consulting services, and tailored analytics solutions. Additionally, DH has established partnerships with key industry players, enhancing its data offerings and broadening its market reach. The company's focus on continuous innovation and expanding its data capabilities also contributes to its earnings by attracting new customers and retaining existing ones.

Definitive Healthcare Corp Financial Statement Overview

Summary

Definitive Healthcare Corp shows revenue growth but struggles with profitability and operational efficiency. The balance sheet is stable but under pressure due to declining equity and assets. Cash flow generation is a strength, supporting operations despite profitability challenges.

Income Statement

Definitive Healthcare Corp shows consistent revenue growth from 2020 to TTM 2025, but faces significant challenges in profitability. The company has experienced deteriorating EBIT and EBITDA margins, with substantial negative net income indicating ongoing operational inefficiencies. Despite gross profit margins being relatively stable, the company struggles with high operational costs negatively affecting net profit margins.

Balance Sheet

The company's balance sheet reveals a mixed outlook. The debt-to-equity ratio is relatively moderate, suggesting manageable leverage. However, there is a declining trend in stockholders’ equity and total assets over recent years. The equity ratio has been decreasing, indicating a potential risk in financial stability if the trend continues. Overall, the company's financial structure is stable but facing downward pressure.

Cash Flow

Cash flow analysis is relatively positive with consistent free cash flow generation. The operating cash flow to net income ratio is strong, indicating effective cash generation despite net losses. However, the free cash flow growth rate has been volatile, reflecting potential challenges in sustaining cash flow improvements. Despite this, the company maintains a positive free cash flow to net income ratio.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	244.93M	252.20M	251.41M	222.65M	166.15M	118.32M
Gross Profit	187.01M	197.47M	164.93M	180.03M	125.47M	87.85M
EBITDA	-399.92M	-567.24M	-241.23M	23.44M	23.05M	44.91M
Net Income	-304.75M	-413.12M	-202.39M	-7.22M	-51.91M	-51.16M
Balance Sheet
Total Assets	770.14M	1.09B	1.83B	2.12B	2.12B	1.75B
Cash, Cash Equivalents and Short-Term Investments	184.20M	290.16M	308.07M	331.87M	387.50M	24.77M
Total Debt	8.92M	253.11M	267.93M	275.85M	270.68M	461.88M
Total Liabilities	358.91M	482.19M	626.73M	633.77M	612.73M	549.80M
Stockholders Equity	411.23M	444.38M	861.36M	952.14M	873.21M	1.20B
Cash Flow
Free Cash Flow	51.27M	45.85M	38.21M	27.25M	18.48M	21.82M
Operating Cash Flow	62.94M	58.20M	41.19M	35.58M	25.21M	23.22M
Investing Cash Flow	56.07M	-26.41M	-31.78M	-248.90M	-46.73M	-23.86M
Financing Cash Flow	-159.84M	-56.75M	-25.58M	-26.70M	384.37M	16.66M

Definitive Healthcare Corp Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DH, the sentiment is Negative. The current price of 2.99 is below the 20-day moving average (MA) of 3.65, below the 50-day MA of 3.82, and below the 200-day MA of 3.72, indicating a bearish trend. The MACD of -0.27 indicates Positive momentum. The RSI at 32.84 is Neutral, neither overbought nor oversold. The STOCH value of 11.84 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DH.

Definitive Healthcare Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSTM	73 Outperform	$752.59M	38.16	5.81%	0.47%	3.50%	13.99%
PINC	70 Neutral	$2.30B	125.99	3.56%	3.00%	-24.79%	-78.38%
GDRX	68 Neutral	$1.48B	44.83	5.27%	―	3.20%	―
PHR	66 Neutral	$1.33B	―	-8.76%	―	15.31%	77.02%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
EVH	51 Neutral	$902.47M	―	-13.38%	―	-6.71%	-71.40%
DH	46 Neutral	$408.92M	―	-64.27%	―	-5.24%	23.59%

Definitive Healthcare Corp Corporate Events

Definitive Healthcare Announces CFO Departure and Stock Buyback

Definitive Healthcare has announced key developments including the transition of its CFO, Richard Booth, who will depart in June 2025, and a $100 million stock repurchase program set to commence following a previous $20 million program. The company reported a third-quarter revenue of $62.7 million, exceeding its guidance, despite a net loss due to goodwill impairment. With an eye on future growth, the company is actively assessing market opportunities and strengthening its customer base, evident from recent strategic partnerships and customer acquisitions.