Canaccord Genuity Group has reaffirmed its “Hold” rating on shares of HealthStream (NASDAQ: HSTM) in a report released on November 3, 2023. The brokerage has set a target price of $28.00 for the technology company, which provides workforce development solutions primarily for the healthcare sector. This decision comes amid a flurry of recent analyst evaluations of the company.
In a notable shift, Wall Street Zen reduced its rating on HealthStream from “Buy” to “Hold” earlier this month. Weiss Ratings also maintained a “Hold (c)” rating on the stock on October 8, 2023. Currently, one analyst has assigned a “Buy” rating, while three have opted for “Hold,” leading to an overall average rating of “Hold” according to MarketBeat.com. The consensus target price remains at $28.00.
HealthStream’s Recent Financial Performance
HealthStream recently reported its earnings for the third quarter of 2023 on November 3. The company achieved earnings per share (EPS) of $0.20, surpassing analysts’ expectations of $0.17 by $0.03. The firm recorded a net margin of 6.93% and a return on equity of 5.82%. Revenue for the quarter reached $76.47 million, exceeding projections of $75.52 million.
Looking ahead, analysts anticipate HealthStream will post an EPS of $0.63 for the current fiscal year. The company’s recent financial results highlight its ability to perform above market expectations, which may provide a solid foundation for its stock performance.
Dividend and Share Buyback Plans
On November 28, HealthStream paid a quarterly dividend of $0.031 per share to stockholders of record as of November 17, 2023. This dividend translates to an annualized rate of $0.12, yielding approximately 0.5%. The company’s dividend payout ratio stands at 17.65%, indicating a conservative approach to sharing profits with shareholders.
Additionally, on November 11, HealthStream’s Board of Directors authorized a share buyback program allowing the company to repurchase up to $10 million in outstanding shares. This initiative suggests management’s confidence in the stock’s undervaluation in the current market.
Insider Transactions and Institutional Holdings
Recent insider trading activity has also drawn attention. Chief Technology Officer Jeff Cunningham sold 2,100 shares on December 10, 2023, for an average price of $24.09, totaling $50,589. Following this transaction, Cunningham retains 31,489 shares valued at approximately $758,570, representing a 6.25% reduction in his stake.
Furthermore, Director Tate Deborah Taylor sold 1,580 shares on November 26, 2023, at an average price of $25.46, resulting in total proceeds of $40,226.80. After this sale, Taylor holds 23,127 shares valued at about $588,813.42, marking a 6.39% decrease in ownership.
In the last three months, insiders have sold a total of 5,680 shares worth $139,336. Currently, insiders own 20.50% of HealthStream’s stock.
Institutional investors have also been active. Copeland Capital Management LLC increased its stake in HealthStream by 15.6% during the second quarter, now holding 882,950 shares valued at $24.43 million. Other significant stakeholders include Geode Capital Management LLC and JPMorgan Chase & Co., which boosted their holdings significantly in recent quarters.
As of now, 69.58% of HealthStream’s stock is owned by institutional investors and hedge funds, indicating strong institutional confidence in the company’s future prospects.
About HealthStream
Founded in 1990 and headquartered in Nashville, Tennessee, HealthStream, Inc. provides workforce development and learning management solutions tailored for healthcare organizations. The company focuses on assisting hospitals, clinics, and other care providers in streamlining staff training, ensuring regulatory compliance, and monitoring employee performance.
HealthStream’s platform features a learning management system (LMS) specifically designed for clinical and nonclinical personnel, alongside a competency management suite that tracks skill acquisition and validation. The company also offers a comprehensive content library that includes evidence-based clinical and compliance training modules.
HealthStream continues to navigate a competitive landscape in healthcare technology, leveraging its expertise to meet the evolving needs of healthcare providers.
