Let’s dig into the relative performance of Evolent Health (NYSE: EVH) and its peers as we unravel the now-completed Q3 healthcare technology for providers earnings season.
The healthcare technology sector provides software and data analytics to help hospitals and clinics streamline operations and improve patient outcomes, often through value-based care models. Future growth is expected as providers prioritize digital transformation to manage rising costs and patient demands. Tailwinds include the adoption of AI-driven tools and government incentives for digitization. There challenges as well, including long sales cycles and slow adoption by providers, who may be resistance to change. Tightening hospital budgets and cybersecurity threats are additional risks that could slow adoption.
The 5 healthcare technology for providers stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 4.8% while next quarter’s revenue guidance was 1% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 9.8% since the latest earnings results.
Evolent Health (NYSE: EVH)
Founded in 2011 to transform how healthcare is delivered to patients with complex needs, Evolent Health (NYSE: EVH) provides specialty care management services and technology solutions that help health plans and providers deliver better care for patients with complex conditions.
Evolent Health reported revenues of $479.5 million, down 22.8% year on year. This print exceeded analysts’ expectations by 2.6%. Despite the top-line beat, it was still a slower quarter for the company with a significant miss of analysts’ EPS estimates and EBITDA guidance for next quarter missing analysts’ expectations.
Seth Blackley, Co-Founder and Chief Executive Officer of Evolent stated, "We are happy to deliver a strong quarter, in the top half of our guidance for both Adjusted EBITDA and revenue, while reiterating our fourth quarter outlook. Further, we added another two customer agreements, bringing our total new contracts to thirteen for the year. We now have signed contracts that bring our preliminary 2026 revenue forecast to $2.5 billion. More importantly, we're winning in the marketplace with our Enhanced Performance Suite model that balances disciplined growth and margin. Finally, we continue to improve our product with our member navigation and Oncology Care Partners innovations. We expect to close the previously announced ECP transaction later this year and expect to use the proceeds to pay down our senior debt."
Evolent Health achieved the highest full-year guidance raise but had the slowest revenue growth of the whole group. Still, the market seems discontent with the results. The stock is down 5.2% since reporting and currently trades at $4.21.
Read our full report on Evolent Health here, it’s free for active Edge members.
Best Q3: Privia Health (NASDAQ: PRVA)
Operating in 13 states and the District of Columbia with over 4,300 providers serving more than 4.8 million patients, Privia Health (NASDAQ: PRVA) is a technology-driven company that helps physicians optimize their practices, improve patient experiences, and transition to value-based care models.
Privia Health reported revenues of $580.4 million, up 32.5% year on year, outperforming analysts’ expectations by 16.6%. The business had a stunning quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.
Privia Health pulled off the biggest analyst estimates beat among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 5.2% since reporting. It currently trades at $23.74.
Is now the time to buy Privia Health? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q3: Astrana Health (NASDAQ: ASTH)
Formerly known as Apollo Medical Holdings until early 2024, Astrana Health (NASDAQ: ASTH) operates a technology-powered healthcare platform that enables physicians to deliver coordinated care while successfully participating in value-based payment models.
Astrana Health reported revenues of $956 million, up 99.7% year on year, exceeding analysts’ expectations by 0.6%. Still, it was a softer quarter as it posted a significant miss of analysts’ EPS estimates and full-year revenue guidance missing analysts’ expectations.
Astrana Health delivered the fastest revenue growth but had the weakest full-year guidance update in the group. As expected, the stock is down 34.3% since the results and currently trades at $21.92.
Read our full analysis of Astrana Health’s results here.
Omnicell (NASDAQ: OMCL)
Driven by the vision of an "Autonomous Pharmacy" with zero medication errors, Omnicell (NASDAQ: OMCL) provides medication management automation and adherence tools that help healthcare systems and pharmacies reduce errors and improve efficiency.
Omnicell reported revenues of $310.6 million, up 10% year on year. This number surpassed analysts’ expectations by 5%. Overall, it was a very strong quarter as it also recorded a beat of analysts’ EPS estimates and a solid beat of analysts’ revenue estimates.
The stock is up 20.2% since reporting and currently trades at $35.54.
Read our full, actionable report on Omnicell here, it’s free for active Edge members.
Premier (NASDAQ: PINC)
Operating one of the largest healthcare group purchasing organizations in the United States with over 4,350 hospital members, Premier (NASDAQ: PINC) is a technology-driven healthcare improvement company that helps hospitals, health systems, and other providers reduce costs and improve clinical outcomes.
Premier reported revenues of $240 million, down 3.3% year on year. This result missed analysts’ expectations by 1%. Zooming out, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but a slight miss of analysts’ revenue estimates.
Premier had the weakest performance against analyst estimates among its peers. The stock is flat since reporting and currently trades at $28.17.
Read our full, actionable report on Premier here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
