Health Catalyst (HCAT) Stock Trades Up, Here Is Why

Radek Strnad /
2023/11/13 11:49 am EST

What Happened:

Shares of healthcare software provider Health Catalyst (NASDAQ:HCAT) jumped 5.7% in the morning session after Piper Sandler analyst Jessica Tassan upgraded the stock's rating from Neutral (Hold) to Overweight (Buy). Tassan expressed confidence in the company's tech-enabled managed services (TEMS) to bring in new customers and boost EBITDA growth, aligning with management's Q3'23 earnings call forecast that the largest part of Q4'23 bookings would come from TEMS. The analyst also commended Health Catalyst's cost-saving initiatives and expanding pipeline.

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What is the market telling us:

Health Catalyst's shares are very volatile and over the last year have had 32 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business. 

The biggest move we wrote about over the last year was 7 months ago, when the company gained 9% on the news that analyst Stan Berenshteyn of Wells Fargo upgraded the stock's rating from Equal-Weight (Hold) to Overweight (Buy) and raised the price target from $13 to $16. The target price implies a 30% upside to the current price.

Health Catalyst is down 28% since the beginning of the year, and at $7.48 per share it is trading 49.3% below its 52-week high of $14.76 from February 2023. Investors who bought $1,000 worth of Health Catalyst's shares at the IPO in July 2019 would now be looking at an investment worth $190.96.

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