HCAT Stock Forecast & Price Target

Health Catalyst Inc. reported a revenue increase of 6% year-over-year, reaching $79.6 million, indicating consistent growth primarily driven by its focus on higher-margin, recurring technology revenue. The company aims to add approximately 40 net new platform clients in fiscal year 2025, which includes an encouraging start with six clients already signed, suggesting positive traction in its sales efforts. Additionally, the upward revision of EBITDA guidance by $2 million signals a strong expectation of synergies being delivered ahead of schedule, contributing to an overall favorable outlook for the company's financial performance moving forward.

Health Catalyst Inc. is experiencing significant challenges reflected in its revised EBITDA guidance of approximately $4 million, which falls drastically short of the consensus expectation of $8.8 million, representing a negative deviation of 55%. Additionally, the company's revenue guidance for 1Q25 is set at $79 million, which is 4% lower than consensus estimates of $82 million, indicating a persistent struggle to meet market expectations. Moreover, the slowdown in mergers and acquisitions, paired with difficulties in client migrations to the new Ignite platform, has resulted in a negative mix shift in the overall business, exacerbating the company's gross margin issues and creating a challenging operating environment.