Wall Street Zen Upgrades HealthStream (NASDAQ:HSTM) to Buy

Key Points

• Wall Street Zen upgraded HealthStream from hold to buy, adding to generally neutral sentiment on the stock. Other firms remain cautious, with the consensus analyst rating still at Hold and an average target price of $24.00.
• HealthStream recently reported better-than-expected earnings, posting $0.20 EPS versus the $0.16 estimate and revenue of $81.2 million, also ahead of forecasts. Analysts expect the company to earn $0.73 per share for the full year.
• The company also authorized a $10 million share buyback, which could signal management believes the stock is undervalued. Institutional ownership is high at 69.58%, and several big investors increased their stakes recently.

HealthStream (NASDAQ:HSTM - Get Free Report) was upgraded by stock analysts at Wall Street Zen from a "hold" rating to a "buy" rating in a research report issued to clients and investors on Saturday.

Several other brokerages have also issued reports on HSTM. Canaccord Genuity Group increased their target price on HealthStream to $24.00 and gave the stock a "hold" rating in a research report on Wednesday. Weiss Ratings raised HealthStream from a "sell (d+)" rating to a "hold (c-)" rating in a research report on Wednesday. Three equities research analysts have rated the stock with a Hold rating, According to MarketBeat, the company has a consensus rating of "Hold" and an average target price of $24.00.

HealthStream Stock Performance

NASDAQ HSTM opened at $23.96 on Friday. HealthStream has a fifty-two week low of $19.50 and a fifty-two week high of $29.63. The stock has a 50 day simple moving average of $21.18 and a two-hundred day simple moving average of $22.58. The stock has a market cap of $700.11 million, a P/E ratio of 35.76, a price-to-earnings-growth ratio of 2.71 and a beta of 0.41.

HealthStream (NASDAQ:HSTM - Get Free Report) last announced its earnings results on Monday, May 4th. The technology company reported $0.20 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.16 by $0.04. HealthStream had a return on equity of 6.47% and a net margin of 6.39%.The firm had revenue of $81.20 million during the quarter, compared to analyst estimates of $79.68 million. Sell-side analysts predict that HealthStream will post 0.73 earnings per share for the current year.

HealthStream declared that its board has authorized a share buyback plan on Friday, March 13th that authorizes the company to buyback $10.00 million in shares. This buyback authorization authorizes the technology company to reacquire up to 1.7% of its shares through open market purchases. Shares buyback plans are generally an indication that the company's leadership believes its shares are undervalued.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in HSTM. Royal Bank of Canada increased its position in HealthStream by 194.2% during the 1st quarter. Royal Bank of Canada now owns 43,899 shares of the technology company's stock valued at $1,413,000 after buying an additional 28,977 shares in the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC increased its position in HealthStream by 15.3% during the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 54,354 shares of the technology company's stock valued at $1,749,000 after buying an additional 7,211 shares in the last quarter. Jane Street Group LLC bought a new position in HealthStream during the 1st quarter valued at approximately $1,532,000. JPMorgan Chase & Co. increased its position in HealthStream by 302.0% during the 2nd quarter. JPMorgan Chase & Co. now owns 247,905 shares of the technology company's stock valued at $6,860,000 after buying an additional 186,231 shares in the last quarter. Finally, American Century Companies Inc. increased its position in HealthStream by 11.6% during the 2nd quarter. American Century Companies Inc. now owns 58,541 shares of the technology company's stock valued at $1,620,000 after buying an additional 6,096 shares in the last quarter. Institutional investors own 69.58% of the company's stock.

About HealthStream

HealthStream, Inc is a Nashville, Tennessee–based provider of workforce development and learning management solutions for healthcare organizations. Since its founding in 1990, the company has focused on helping hospitals, clinics and other care providers streamline staff training, ensure regulatory compliance and monitor employee performance. HealthStream's platform integrates online courses, skill competency assessments and credential management tools to support workforce readiness across the healthcare continuum.

The company's core offerings include a learning management system (LMS) designed specifically for clinical and nonclinical personnel, a competency management suite that tracks skill acquisition and validation, and a content library featuring evidence-based clinical and compliance training modules.

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