Huron Consulting Targets Double-Digit Growth Through 2029 on AI, Managed Services

Key Points

• Huron targets sustained double-digit growth through 2029, including 6%–8% annual organic revenue growth and 2%–4% from acquisitions. It aims to reach 15%–17% adjusted EBITDA margins and double adjusted EPS from 2024 levels by 2029.
• Demand is being driven by financial and regulatory pressures affecting healthcare providers and universities, including reimbursement challenges, rising costs, enrollment declines, research funding cuts and technology modernization needs.
• Managed services and AI are key growth opportunities. Healthcare managed services grew 43% and are expected to reach about 20% of the healthcare segment next year, while AI is being applied to planning, patient referrals, coding, payer interactions and internal consulting efficiency.

Huron Consulting Group NASDAQ: HURN expects continued double-digit growth through 2029 as healthcare providers, higher-education institutions and commercial clients navigate financial pressure, technology modernization and regulatory complexity, Chief Financial Officer John Kelly said during the Sidoti September Small-Cap Virtual Conference.

Kelly said Huron is a global professional services firm focused on helping clients address complex operational and strategic challenges. Approximately 50% of the company’s revenue comes from nonprofit healthcare providers, including hospitals, health systems and academic medical centers. Higher education accounts for about 30% of revenue, while commercial industries account for roughly 20%.

The company’s education clients are primarily among the top 200 U.S. research universities, Kelly said. Within commercial markets, Huron focuses on financial services, energy and utilities, and industrial and manufacturing clients.

Financial Performance and Outlook

Kelly highlighted Huron’s 2025 results, including 12% growth in revenue before reimbursable expenses, or RBR, an 80-basis-point increase in adjusted EBITDA margin and a 21% increase in adjusted diluted earnings per share.

At the midpoint of its 2026 guidance, Huron expects another 12% increase in revenue, adjusted EBITDA margin of 14.75%, and adjusted earnings per share of $9.20. The EPS outlook would represent a 17.5% increase from 2025, according to Kelly.

For the period through 2029, Huron is targeting low-double-digit annual RBR growth. The company expects 6% to 8% of that growth to come organically, with an additional 2% to 4% from acquisitions. Huron is targeting adjusted EBITDA margins of 15% to 17% by 2029 and expects to double adjusted EPS from 2024 levels by that year.

Kelly said about 75% of the company’s annual adjusted EBITDA converts to free cash flow. He added that Huron includes stock-based compensation as an expense in its adjusted EBITDA calculations.

Financial Pressures Drive Client Demand

Kelly said the financial strain facing healthcare and education clients supports demand for Huron’s services rather than weakening it. A central offering in healthcare is performance-improvement work designed to help clients restore margins, meet cash obligations and pursue investments in their missions.

“It is that pressure that our clients are feeling that really drives a lot of demand for our services,” Kelly said.

In healthcare, he cited persistent reimbursement pressure, rising costs and new regulatory requirements. He also pointed to Medicaid work requirements, changes affecting Affordable Care Act plan volumes and subsidies, and pressure on 340B pharmacy subsidies for safety-net hospitals as additional factors affecting clients.

In higher education, Kelly cited declining U.S. student enrollment tied to lower birth rates, reduced flows of international students, research funding cuts and increased expenses related to athletic programs.

Huron’s revenue mix has remained near 50% healthcare, 30% education and 20% commercial in recent years, he said. However, Kelly said the commercial business could become a larger contributor over time as the company pursues market share among clients with roughly $5 billion to $10 billion in revenue. He said those clients often have complex needs but may be below the target size for larger consulting firms.

Managed Services and AI Opportunities

Managed services have become a growing part of Huron’s healthcare business. Kelly said the healthcare managed-services unit grew 43% during the first part of the year. Including the RelateCare acquisition completed in June, Huron expects managed services to represent about 20% of the healthcare segment next year on a pro forma basis.

Kelly said the managed-services business has margins broadly in line with Huron’s healthcare segment, which he described as the company’s highest-margin segment. He said the business also supports recurring revenue growth.

On artificial intelligence, Kelly said Huron sees AI as an opportunity to improve client outcomes, expand services and raise internal efficiency. The company is using proprietary data from prior projects, particularly in healthcare and education, to help consultants identify opportunities for clients more quickly during project assessments.

Huron also sees demand for advisory services as clients seek help deploying AI tools with sensitive data and mission-critical requirements. Kelly said clients that have underinvested in technology are increasingly adopting cloud-based platforms that can support governed data and AI functionality.

• AI use cases include dynamic planning and scenario analysis in finance organizations.
• Healthcare applications include patient referral intake processes.
• The company also cited coding and payer-interaction workflows as areas suited for automation.

Capital Allocation and M&A

Kelly said Huron seeks to balance share repurchases with tuck-in acquisitions while maintaining year-end leverage in the low-two-times range, or approximately two to 2.5 times.

The company completed five acquisitions last year and one this year. Kelly said Huron leaned more heavily toward share repurchases earlier this year, when management viewed its stock price as an attractive opportunity. However, he said the acquisition pipeline remains robust and that 2027 could bring increased deal activity as valuation expectations between buyers and sellers become more aligned.

Kelly said Huron’s low consultant turnover, internal promotion pipeline and employee engagement are important factors supporting its ability to add talent and sustain growth.

About Huron Consulting Group (NASDAQ:HURN)

Huron Consulting Group Inc NASDAQ: HURN is a professional services firm that helps organizations improve performance, manage change and address complex business challenges. The company works with clients across the healthcare, education, commercial and public sectors, providing consulting, technology and managed services.

Huron's services include strategic planning, operational improvement, organizational transformation, financial and performance management, data and analytics, and technology implementation.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.