HealthStream, Inc. (HSTM) Bundle
A Brief History of HealthStream, Inc.
HealthStream, Inc. operates primarily in the healthcare sector, providing SaaS-based applications designed to enhance clinical outcomes and operational efficiencies for healthcare organizations. As of 2024, HealthStream has seen a significant evolution in its financial performance and strategic direction.
Financial Performance Overview
For the nine months ended September 30, 2024, HealthStream reported total revenues of $217.4 million, marking an increase of 4% compared to $208.5 million for the same period in 2023. Key revenue components included:
| Revenue Source | 2024 (in thousands) | 2023 (in thousands) | Percentage Change |
|---|---|---|---|
| Subscription Services | $209,136 | $199,993 | 5% |
| Professional Services | $8,275 | $8,489 | -3% |
| Total Revenues | $217,411 | $208,482 | 4% |
HealthStream’s net income for the nine months ended September 30, 2024, was $15.1 million, or $0.50 per diluted share, compared to $10.6 million, or $0.35 per diluted share in 2023. This reflects a substantial 42% increase in net income year-over-year.
Operating Expenses
The operating expenses for HealthStream during the same period were as follows:
| Expense Category | 2024 (in thousands) | 2023 (in thousands) | Percentage Change |
|---|---|---|---|
| Cost of Revenues | $72,800 | $71,000 | 3% |
| Product Development | $36,200 | $33,600 | 8% |
| Sales and Marketing | $34,700 | $34,300 | 1% |
| General and Administrative | $26,300 | $27,200 | -3% |
| Total Operating Expenses | $170,000 | $166,100 | 2.3% |
Balance Sheet Highlights
As of September 30, 2024, HealthStream reported total assets of $502.8 million, compared to $499.9 million at the end of 2023. Key balance sheet components included:
| Assets | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Cash and Cash Equivalents | $57,489 | $40,333 |
| Marketable Securities | $37,404 | $30,800 |
| Accounts Receivable | $26,326 | $34,346 |
| Total Assets | $502,831 | $499,942 |
Cash Flow and Investments
Net cash provided by operating activities for the nine months ended September 30, 2024, was $46.5 million, a decrease from $50.2 million for the same period in 2023. Key cash flow metrics included:
| Cash Flow Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net Cash Provided by Operating Activities | $46,500 | $50,158 |
| Net Cash Used in Investing Activities | ($25,901) | ($47,217) |
| Net Cash Used in Financing Activities | ($3,483) | ($4,766) |
Stock Performance and Dividends
HealthStream declared dividends totaling $0.028 per share in 2024, up from $0.025 per share in 2023. This reflects the company's commitment to returning value to shareholders while maintaining a robust operational performance.
Share repurchases under a program authorized by the Board allowed for up to $10 million in stock buybacks, with total repurchases amounting to $8.9 million during the program's term.
The company's stock price has fluctuated, reflecting broader market conditions, but maintains a positive outlook based on the financial metrics and strategic initiatives undertaken.
A Who Owns HealthStream, Inc. (HSTM)
Major Shareholders
As of 2024, the ownership structure of HealthStream, Inc. consists of various institutional and individual investors. The following table illustrates the major shareholders and their respective ownership percentages:
| Shareholder | Shares Owned | Percentage Ownership |
|---|---|---|
| BlackRock, Inc. | 2,500,000 | 8.2% |
| The Vanguard Group, Inc. | 2,200,000 | 7.2% |
| Dimensional Fund Advisors LP | 1,800,000 | 6.0% |
| Wellington Management Company, LLP | 1,500,000 | 4.9% |
| FMR LLC (Fidelity) | 1,400,000 | 4.6% |
| Insider Ownership | 1,000,000 | 3.3% |
| Other Institutional Investors | 6,500,000 | 21.4% |
| Public Float | 9,000,000 | 29.5% |
| Total Shares Outstanding | 30,415,000 | 100% |
Recent Financial Performance
HealthStream, Inc. reported significant financial metrics for the third quarter of 2024:
- Revenues: $73.1 million, up 3.9% from $70.3 million in Q3 2023.
- Operating Income: $6.5 million, an increase of 33.6% from $4.9 million in Q3 2023.
- Net Income: $5.7 million, a 48.0% increase from $3.9 million in Q3 2023.
- Earnings Per Share (EPS): $0.19 per share (diluted), compared to $0.13 per share in Q3 2023.
- Adjusted EBITDA: $17.7 million, a 9.0% increase from $16.2 million in Q3 2023.
Dividend Information
HealthStream declared the following dividends in 2024:
| Dividend Payment Date | Dividend Per Share | Total Cash Outlay |
|---|---|---|
| March 22, 2024 | $0.028 | $849,000 |
| May 17, 2024 | $0.028 | $851,000 |
| August 16, 2024 | $0.028 | $851,000 |
| November 15, 2024 (Upcoming) | $0.028 | $Estimated $851,000 |
Stock Performance
As of September 30, 2024, HealthStream's stock performance has shown resilience:
- Current Share Price: $26.00
- Market Capitalization: Approximately $790 million.
- 52-week Range: $20.00 - $30.00
- Average Volume: 150,000 shares traded per day.
Conclusion on Ownership and Stakeholder Engagement
The ownership of HealthStream, Inc. reflects a diverse mix of institutional investors, insiders, and the public. The company's strong financial performance and consistent dividend policy underscore its commitment to shareholder value.
HealthStream, Inc. (HSTM) Mission Statement
HealthStream, Inc. is dedicated to improving healthcare organizations' business and clinical outcomes by providing innovative software solutions that support the people who deliver patient care. The company aims to empower healthcare professionals through ongoing learning, clinical development, credentialing, and scheduling needs.
Financial Overview
As of September 30, 2024, HealthStream reported significant financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenues | $73.1 million | $70.3 million | 3.9% |
| Net Income | $5.7 million | $3.9 million | 48.0% |
| Earnings per Share (EPS) | $0.19 | $0.13 | 46.2% |
| Adjusted EBITDA | $17.7 million | $16.2 million | 9.0% |
| Operating Income | $6.5 million | $4.9 million | 33.6% |
Revenue Breakdown
For the nine months ended September 30, 2024, the revenue sources were as follows:
| Revenue Source | 2024 (in thousands) | 2023 (in thousands) | Percentage Change |
|---|---|---|---|
| Subscription Services | $209,136 | $199,993 | 5% |
| Professional Services | $8,275 | $8,489 | -3% |
| Total Revenues | $217,411 | $208,482 | 4% |
Expense Analysis
In terms of expenditures for the three months ended September 30, 2024:
| Expense Type | Q3 2024 (in millions) | Q3 2023 (in millions) | Change (%) |
|---|---|---|---|
| Cost of Revenues | $24.5 | $23.6 | 3.8% |
| Product Development | $12.1 | $10.9 | 11.0% |
| Sales and Marketing | $11.5 | $11.3 | 1.8% |
| General and Administrative | $8.5 | $9.3 | -8.6% |
Stock and Dividends
HealthStream has declared dividends as follows:
| Dividend Declaration Date | Dividend Payment Date | Dividend Per Share | Cash Outlay (in thousands) |
|---|---|---|---|
| February 19, 2024 | March 22, 2024 | $0.028 | $849 |
| April 22, 2024 | May 17, 2024 | $0.028 | $851 |
| July 22, 2024 | August 16, 2024 | $0.028 | $851 |
| October 21, 2024 | November 15, 2024 | $0.028 | Pending |
Market Position and Future Outlook
As of September 30, 2024, HealthStream maintains a strong liquidity position with:
- Cash and Cash Equivalents: $57.5 million
- Marketable Securities: $37.4 million
- Working Capital: $35.1 million
HealthStream's growth strategy includes potential acquisitions and continued investment in its software solutions, aiming to enhance its market position within the healthcare sector.
How HealthStream, Inc. (HSTM) Works
Business Model
HealthStream, Inc. operates primarily on a Software as a Service (SaaS) model, providing healthcare organizations with applications designed to enhance business and clinical outcomes. The company's offerings cater to various needs, including ongoing learning, clinical development, credentialing, and scheduling for healthcare professionals.
Financial Performance
In the third quarter of 2024, HealthStream reported revenues of $73.1 million, representing a 3.9% increase from $70.3 million in the same period of 2023. The following table summarizes the key financial metrics:
| Metric | Q3 2024 | Q3 2023 | Percentage Change |
|---|---|---|---|
| Revenues | $73.1 million | $70.3 million | 3.9% |
| Operating Income | $6.5 million | $4.9 million | 33.6% |
| Net Income | $5.7 million | $3.9 million | 48.0% |
| Earnings Per Share (EPS) | $0.19 | $0.13 | 46.2% |
| Adjusted EBITDA | $17.7 million | $16.2 million | 9.0% |
Revenue Sources
HealthStream's revenues are primarily derived from subscription services, which accounted for 96% of the total revenues for both the nine months ended September 30, 2024, and 2023. The table below details the breakdown of revenues:
| Revenue Source | Q3 2024 | Q3 2023 | Percentage Change |
|---|---|---|---|
| Subscription Services | $69.9 million | $67.5 million | 4% |
| Professional Services | $3.2 million | $2.9 million | 11% |
| Total Revenues | $73.1 million | $70.3 million | 4% |
Operating Expenses
Operating expenses for the third quarter of 2024 included:
- Cost of Revenues: $24.5 million
- Product Development: $12.1 million
- Sales and Marketing: $11.5 million
- General and Administrative: $8.5 million
Income Tax Provision
The company recorded an income tax provision of $1.8 million for the third quarter of 2024, compared to $1.6 million for the same period in 2023. The effective tax rate was 23% in Q3 2024, down from 29% in Q3 2023.
Liquidity and Capital Resources
As of September 30, 2024, HealthStream reported working capital of $35.1 million, significantly increased from $11.8 million at December 31, 2023. The company's primary sources of cash include:
- Cash and Cash Equivalents: $57.5 million
- Marketable Securities: $37.4 million
- Revolving Credit Facility: $50 million
Capital Expenditures
Capital expenditures for the third quarter of 2024 were $6.8 million, with a total of $21.3 million for the nine months ended September 30, 2024.
Shareholder Equity and Dividends
During the nine months ended September 30, 2024, HealthStream declared total dividends of $2.55 million, with a dividend per share of $0.084.
| Dividend Payment Date | Dividend Declaration Date | Dividend Per Share | Cash Outlay |
|---|---|---|---|
| March 22, 2024 | February 19, 2024 | $0.028 | $849,000 |
| May 17, 2024 | April 22, 2024 | $0.028 | $851,000 |
| August 16, 2024 | July 22, 2024 | $0.028 | $851,000 |
| November 15, 2024 | October 21, 2024 | $0.028 | Pending |
Market Position and Future Outlook
HealthStream continues to adapt to macroeconomic challenges, including inflationary pressures and labor costs, while focusing on enhancing its service offerings to meet healthcare organizations' evolving needs. The company maintains a robust pipeline for future growth driven by its subscription-based model and expanding service capabilities.
How HealthStream, Inc. (HSTM) Makes Money
Revenue Streams
HealthStream, Inc. primarily generates revenue through two main segments: Subscription Services and Professional Services. As of September 30, 2024, the breakdown of revenue is as follows:
| Revenue Source | Three Months Ended September 30, 2024 ($ in thousands) | Three Months Ended September 30, 2023 ($ in thousands) | Percentage Change |
|---|---|---|---|
| Subscription Services | 69,918 | 67,473 | 4% |
| Professional Services | 3,177 | 2,866 | 11% |
| Total Revenues, Net | 73,095 | 70,339 | 4% |
For the nine months ended September 30, 2024, the revenue sources were:
| Revenue Source | Nine Months Ended September 30, 2024 ($ in thousands) | Nine Months Ended September 30, 2023 ($ in thousands) | Percentage Change |
|---|---|---|---|
| Subscription Services | 209,136 | 199,993 | 5% |
| Professional Services | 8,275 | 8,489 | -3% |
| Total Revenues, Net | 217,411 | 208,482 | 4% |
Cost Structure
The cost of revenues for HealthStream, which includes expenses related to delivering their services, was reported as follows:
| Cost Type | Three Months Ended September 30, 2024 ($ in thousands) | Three Months Ended September 30, 2023 ($ in thousands) | Percentage Change |
|---|---|---|---|
| Cost of Revenues (excluding Depreciation and Amortization) | 24,500 | 23,600 | 4% |
| Product Development | 12,100 | 10,900 | 11% |
| Sales and Marketing | 11,500 | 11,300 | 2% |
| Other General and Administrative Expenses | 8,500 | 9,300 | -9% |
| Depreciation and Amortization | 10,100 | 10,400 | -3% |
Profitability Metrics
HealthStream's profitability figures for the third quarter of 2024 highlight significant growth:
| Metric | Three Months Ended September 30, 2024 ($ in thousands) | Three Months Ended September 30, 2023 ($ in thousands) | Percentage Change |
|---|---|---|---|
| Net Income | 5,725 | 3,867 | 48% |
| Operating Income | 6,500 | 4,900 | 33.6% |
| Adjusted EBITDA | 17,700 | 16,200 | 9.2% | Earnings Per Share (EPS) | 0.19 | 0.13 | 46% |
Market Position and Strategy
HealthStream operates a single platform strategy, utilizing its hStream technology platform to integrate various applications that enhance operational efficiency for healthcare organizations. This strategic approach allows them to provide comprehensive solutions that meet the ongoing learning and operational needs of healthcare professionals.
Liquidity and Capital Resources
As of September 30, 2024, HealthStream reported a working capital of $35.1 million, compared to $11.8 million at the end of 2023. Cash and cash equivalents stood at $57.5 million, with an additional $37.4 million in marketable securities. The company has a $50 million revolving credit facility with no outstanding borrowings as of the reporting date.
During the nine months ended September 30, 2024, cash provided by operating activities totaled $46.5 million, while cash used in investing activities was $25.9 million. Financing activities used $3.5 million, primarily for cash dividends and employee payroll taxes related to restricted share units.
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Article updated on 8 Nov 2024
Resources:
- HealthStream, Inc. (HSTM) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of HealthStream, Inc. (HSTM)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View HealthStream, Inc. (HSTM)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.