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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Healthequity, Inc. (XNAS:HQY) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
HQY
Name:
HEALTHEQUITY, INC. (XNAS:HQY)
Sector:
12.65M
Industry:
Health Information Services
CEO:
Mr. Jon Kessler
Total Employees:
3,688
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -176.87% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF HEALTHEQUITY, INC.(HQY) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND HEALTH INFORMATION SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
63.99
One Month Price Target:
$64.31
Six Month Price Target :
$65.9
Likely Price in One Year's Time:
Ticker:
$67.82
Likely Trading Range Today Under (Normal Volatility)
$63.64
Price Upper limit ($) :
$64.4
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$59.45
This week:
$53.83
This month :
$43.68
Other Primary facts
Market Cap:
5.35B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
84.37M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
21.07%
-24.6%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$85.07
$75.42
$42.91
$52.56
Medium risk (<10%) entry points
Buy Call
Sell Call
$72.27
Buy Put:
Sell Put:
$70.21
$55.68
$57.77
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
HQY
Sharpe Ratio:
1.19%
Comparison:
HQY, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is 15.55% higher than the industry
& is -47.93% lower than the market/S&P 500 average
Average Returns/Yield of
HQY
Daily returns:
0.05%
Weekly returns:
0.25%
Monthly returns:
1.00%
Yearly returns:
5.07%
Comparison of returns:
Average annual returns/yield (last 3 years) is 137.25% above industry average
Classification:
HQY, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.97
Statistical test of Returns:
HQY has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.48%
Weekly Volatility:
7.78%
Monthly Volatility:
15.57%
Yearly Volatility:
53.92%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.31%
Volatility in last five trading days has been -62.33% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.10%
Weekly VaR:
-15.87%
Monthly VaR:
-31.75%
How Much Can the price of
HQY
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-28%
Worst case (decline):
>85%
This translates to price declining to:
$46.39
This translates to price declining to:
$9.60
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
HQY is a 124.06% riskier investment compared to the market/S&P 500 & is 91.95% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 2.34% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
HQY
Beta in relation to market/S&P 500--0.89
Expected beta in 1 year's time:
0.703
Expected beta in 3 year's time:
0.994
Unlevered (debt free) Beta:
0.648
Beta in relation to Nasdaq (XNAS):
0.635
Beta in relation to all global stocks::
0.975
Beta Comparison & Analysis
Beta of competitors/peers::
1.308
Beta is -31.95% lower than peers
Average Industry Beta:
0.87
Beta is 2.33% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.028
Alpha is -169.12% below industry average alpha yield
Alpha is 178% higher than market/& is unsustainably high
Analysis of Cost of Capital of
HQY
Equity cost of capital:
0.092
Equity cost of capital is 1.53% above industry mean WACC
Unlevered (without debt) cost of capital:
6.74%
Before-tax cost of debt:
3.81%
After-tax cost of debt:
3.01%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.01%
WACC is -10.96% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$9.22
Revenue growth rate per share of (3Y):
2.92
Annual revenue growth rate is -54.27% below industry average
EPS:
-$0.66
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
-
-
-
Debt per share
$11.64
EBITDA per share
$1.26
Valuation Analysis Today of
HQY
P/E Ratio:
4040.18
P/E Ratio of Competitors/Peers:
94.68
P/E ratio is 4167.33% higher than main peers & is 1005.53% higher than the industry
-
HQY is -126.53% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
6.94
Price to sales ratio is -8.46% below the industry mean
P/B (Price to book value ratio):
2.92
-
Price to free cash flow ratio is 228.83% higher than the industry
Net income growth rate (3Y):
-84.85%
Net income growth rate is -104.84% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
53.12%
Net debt to equity ratio:
17.38%
Debt to assets ratio:
31.05%
Net debt to assets ratio:
10.16%
Debt-to-asset ratio is -9.11% below industry average
Ability to repay debt:
Interest coverage ratio:
2.64
Interest coverage ratio is -82.47% less than industry average
Looking forward:
Debt growth rate:
-12.82%
Annual debt growth is -131% lower than industry average debt growth rate
Debt repayment rate in last quarter: 1.57%
Analysis of Key Statistics
Correlation of price movement with the market:
0.417
Statistical significance of correlation:
HQY has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.376
Stock price is 10.71% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.376
Correlation of price movement with Nasdaq (^IXIC):
0.004
Covariance of price movement with the market:
0.008
Kurtosis
8.663
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.155
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
HQY
Gross Profit Margin Ratio:
222%
Operating Profit Margin Ratio:
-4.60%
Operating profit margin is -74.25% lower than the industry
Net Profit Margin Ratio:
222%
Effective Tax Rate:
29.74%
Effective tax rate is 50.15% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-2.99%
Return on equity (ROE) is -8.20% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-1.75%
Return on assets (ROA) is 0.77% higher than the industry
Financial Leverage:
1.5x
Current Ratio:
4.5
Current ratio is -20.12% below industry average
Cash Conversion Cycle (days):
35.5
Cash conversion cycle is -27.90% below industry average
The remaining useful life of property plant & equipment is: 0.0 years
Stock based compensation to net income ratio:
-23.14%
In-depth Efficiency Analysis
Revenue generated per employee:
211.0K
Each employee generates -49% less revenue than industry average revenue per employee
EBITDA generated per employee:
28.9K
Each employee generates -170% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 15.0K
Each employee generates -81% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
3.4K
Each employee generates -73% less free cash flow than industry average revenue per employee
Assets/Capital per employee
622.8K
Each employee generates -73% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 60.89%
Growth rate in R&D investment/expenditure is -565.05% lower than the industry
Competitors/Peer firms of
HQY
KODIAK SCIENCES INC. (XNAS:KOD)
ALKERMES PUBLIC LIMITED COMPANY (XNAS:ALKS)
KARUNA THERAPEUTICS, INC. (XNAS:KRTX)
STAAR SURGICAL COMPANY (XNAS:STAA)
ARVINAS, INC. (XNAS:ARVN)
PROGYNY, INC. (XNAS:PGNY)
ACADIA PHARMACEUTICALS INC. (XNAS:ACAD)
SURGERY PARTNERS, INC. (XNAS:SGRY)
LHC GROUP, INC. (XNAS:LHCG)
Current Analyst Ratings
Strong buy�13%
Buy�25%
Hold�4%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
778.03M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
346.27M
431.76M
167.08M
87.42M
148.50M
61.08M
95.97M
411.55M
615.00K
40.34M
144.91M
106.52M
- 35780.00K
- 55313.00K
- 78726.00K
- 23413.00K
- 55313.00K
Statement of Cash Flow
Date:
Period:
31.77M
Differed Income Tax :
3.24M
Stock Based Compensation :
12.80M
Change in Working Capital :
- 16398.00K
Accounts Receivables:
- 475.00K
Other Working Capital:
- 17748.00K
Other Non-Cash Items:
2.12M
Net Cash Provided by Operating Activities:
30.92M
Investments in PP&E:
- 2490.00K
Net Acquisitions:
- 49533.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
736.77M
-
736.77M
74.47M
-
53.87M
865.11M
113.62M
1.36B
780.79M
-
-
38.78M
2.30B
-
3.16B
9.64M
76.18M
-
-
106.49M
192.30M
981.74M
14.81M
1.12B
-
1.31B
8.00K
217.73M
-
1.63B
April 30, 2021 at 6:00:00 AM
757.82M
1.85B
3.16B
-
1.06B
321.1M
-
- 15778.00K
- 67801.00K
- 15625.00K
456.64M
-
-
3.84M
444.85M
-
407.97M
736.77M
328.80M
30.92M
- 18268.00K
12.65M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
HQY
2023
2024
2025
2026
2027
$68.03
$72.10
$76.42
$80.99
$85.83