Group 1 - The stock market has been recovering from losses incurred due to Trump's tariffs, but there is an expectation that dispersion among stocks will increase, particularly among large-cap stocks that have dominated the market [1] - Gary Alexander has extensive experience in covering technology companies and has been involved with seed-round startups, providing insights into current industry trends [1] Group 2 - The article does not provide specific financial data or performance metrics related to any companies or sectors [2][3]

Group 1 - JP Morgan analyst Lisa C. Gill revised her 2025 outlook on GoodRx Holdings (GDRX) following the company's first-quarter earnings, reaffirming an Overweight rating and maintaining a $7 price forecast [1][6] - GoodRx reported first-quarter 2025 revenue of $203 million, exceeding the estimate of $202.21 million, representing a 3% year-over-year increase. Adjusted EBITDA rose to $69.8 million, with margins improving to 34.4% from 31.7%. Net income was $11.1 million, reversing a $1 million loss from the previous year [1] - The company reaffirmed its full-year 2025 revenue outlook of $810-$840 million and raised its adjusted EBITDA forecast to $273–$287 million, compared to $260.2 million in 2024 [3] Group 2 - Pharma Manufacturer Solutions' revenue climbed 17%, while subscription revenue declined 7%, primarily due to the phaseout of the Kroger Savings Club [2] - Gill slightly revised her 2025 revenue estimate downward to $817 million, citing approximately $5 million in Rite Aid headwinds, offset by strength in Pharma Manufacturer Solutions and improved margins. Adjusted EBITDA projection was increased to $279 million, reflecting 7% growth and a 135 basis-point margin expansion to 34.2% [4] - The trend of pharmacy costs shifting to consumers and efforts by pharmacies/PBMs to capture abandoned scripts create a favorable environment for GoodRx's value proposition, with anticipated solid growth and margin expansion due to ISP adoption and increased consumerism in healthcare [5]

Core Viewpoint - Investors in the Medical Services sector may find GoodRx Holdings, Inc. (GDRX) and Progyny (PGNY) as potential stocks to consider, with GDRX appearing more attractive for value investors [1] Valuation Metrics - GoodRx Holdings, Inc. has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Progyny has a Zacks Rank of 4 (Sell) [3] - GDRX has a forward P/E ratio of 9.59, significantly lower than PGNY's forward P/E of 14.46, suggesting GDRX may be undervalued [5] - The PEG ratio for GDRX is 0.86, compared to PGNY's PEG ratio of 0.94, indicating GDRX's expected earnings growth is more favorable [5] - GDRX's P/B ratio is 2, while PGNY's P/B ratio is 4.73, further supporting GDRX's valuation as more attractive [6] - GDRX's overall Value grade is A, while PGNY's Value grade is C, highlighting GDRX's stronger position in terms of value metrics [6] Earnings Outlook - GDRX is noted for its improving earnings outlook, which enhances its attractiveness in the Zacks Rank model [7]

Core Insights - The article emphasizes the importance of earnings estimates and revisions in identifying strong stocks, while also acknowledging that investors have their own strategies, including value, growth, and momentum trends [1] Value Investing - Value investing focuses on identifying companies that are undervalued by the market, utilizing various valuation metrics to find these stocks [2] Style Scores System - Zacks has created the Style Scores system to highlight stocks with specific traits, where value investors are particularly interested in stocks with high grades in the "Value" category, especially those with a high Zacks Rank [3] GoodRx (GDRX) Overview - GoodRx (GDRX) currently holds a Zacks Rank of 2 (Buy) and a Value grade of A, with a Forward P/E ratio of 10.11, significantly lower than the industry average of 14.40 [4] - Over the past 52 weeks, GDRX's Forward P/E has fluctuated between a high of 22.35 and a low of 9.65, with a median of 14.79 [4] PEG Ratio - GDRX has a PEG ratio of 0.91, which is lower than the industry's average PEG of 1.03, indicating potential undervaluation [5] - The PEG ratio for GDRX has ranged from a high of 2.37 to a low of 0.87 over the last 12 months, with a median of 1.18 [5] Investment Outlook - The metrics suggest that GoodRx is likely undervalued at present, combined with a strong earnings outlook, making it an attractive value stock [6]

Financial Data and Key Metrics Changes - Total revenue for the first quarter of 2025 was $203 million, representing a 3% increase compared to the prior year [26] - Adjusted EBITDA was $69.8 million, an 11% increase year-over-year, with an adjusted EBITDA margin of 34.4%, improving by 60 basis points from the previous quarter [26] - The company ended the quarter with $301 million in cash and $91.7 million of unused capacity on its revolving line of credit, resulting in total liquidity of $392.7 million [27] Business Line Data and Key Metrics Changes - Prescription transaction revenue increased by 217% year-over-year [26] - The integrated savings program (ISP) saw a decline in monthly active consumers (MACs) due to some price increases, but the company maintained its leadership position in the prescription affordability segment, with a segment share increase of over 300 basis points year-over-year in the first two months of the quarter [16][26] Market Data and Key Metrics Changes - Over 12 million consumers and over 750,000 healthcare professionals (HCPs) used GoodRx in the first quarter, indicating strong platform engagement [10] - The company acknowledged ongoing uncertainty in the macroeconomic environment, including regulatory changes and consumer sentiment shifts, which could impact business [12] Company Strategy and Development Direction - The company is focused on high-impact initiatives to strengthen its position in the pharmacy ecosystem, including enhancing partnerships with retail pharmacies and expanding its e-commerce capabilities [8][10] - GoodRx aims to serve as a digital front door for retail pharmacy partners, facilitating tighter partnerships and improving workflows [35] - The company is also investing in its brand to ensure it remains the primary choice for medication access and affordability [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the complexities of the prescription medication landscape and emphasized the importance of partnerships with pharmacies and manufacturers [10][12] - The company is aware of the potential impact of Rite Aid's bankruptcy on its business but believes it is well-positioned to manage the transition of prescriptions to other pharmacies [29][46] Other Important Information - GoodRx was recognized as one of Newsweek and USA Today's 2025 most trusted brands, reinforcing its value proposition to consumers [14] - The company is actively engaging with pharmacy partners to ensure smooth transitions for patients affected by retail closures [13] Q&A Session Summary Question: What are the most important high-impact initiatives for the company? - Management highlighted closer partnerships with retail pharmacies and expanding brand partnerships as key initiatives to drive growth [35] Question: How does the company plan to manage the impact of Rite Aid's bankruptcy? - Management stated that they are in discussions with retail partners to ensure a smooth transition for affected prescriptions and emphasized that the impact on revenue is expected to be less than 5% [29][46] Question: What is the company's perspective on the shift to cost-plus pricing by larger PBMs? - Management indicated that a significant portion of their business already operates on cost-plus pricing and that this shift does not significantly impact their cash prescription opportunities [54] Question: Is there still an opportunity with GLP medications? - Management confirmed that opportunities with GLP medications remain and that they are in discussions with manufacturers to embed their programs on the GoodRx platform [58][60] Question: How does the company view its capital allocation strategy? - Management stated that they will continue to invest in the business while also prioritizing stock repurchases due to the undervalued stock price [87] Question: What is the company's exposure to Medicare beneficiaries? - Management noted that less than 30% of users are Medicare eligible, and only 2-3% hit their maximum out-of-pocket, indicating limited impact from changes in Medicare policies [94][96]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $203 million, reflecting a 3% increase year-over-year [25] - Prescription transaction revenue and manufacturer solutions revenue increased by 217% year-over-year [25] - Adjusted EBITDA for Q1 2025 was $69.8 million, an 11% increase year-over-year, with an adjusted EBITDA margin of 34.4% [25] Business Line Data and Key Metrics Changes - The prescription marketplace and manufacturer solutions offerings saw significant growth, with a focus on enhancing partnerships with pharmacies and pharmaceutical manufacturers [10][18] - The integrated savings program (ISP) is being evaluated for expansion into non-covered medications, indicating a strategic shift to enhance value [17] Market Data and Key Metrics Changes - Over 12 million consumers and 750,000 healthcare professionals (HCPs) utilized GoodRx in Q1 2025, demonstrating strong platform engagement [9] - The company noted ongoing uncertainty in the macroeconomic environment, including regulatory changes and consumer sentiment shifts, which could impact business [11] Company Strategy and Development Direction - The company is focused on high-impact initiatives to strengthen its position in the pharmacy ecosystem, including leadership changes and strategic partnerships [5][6] - GoodRx aims to enhance its e-commerce capabilities and integrate more deeply with pharmacy operations to improve consumer experience and pharmacy profitability [16][21] - The company is committed to investing in its brand and expanding its value proposition to consumers and HCPs [13][22] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the Rite Aid bankruptcy and emphasized the importance of maintaining relationships with pharmacy partners to ensure smooth transitions for consumers [11][12] - The company remains optimistic about its future growth opportunities, particularly in expanding its partnerships and enhancing its service offerings [20][22] Other Important Information - The company ended Q1 2025 with $301 million in cash and $91.7 million of unused capacity on its revolving line of credit, indicating strong liquidity [25] - A share repurchase program is in place, with approximately $189 million remaining under the $450 million authorization [25] Q&A Session Summary Question: What are the most important high-impact initiatives for the company? - Management highlighted closer partnerships with retail pharmacies and expanding brand partnerships as key initiatives to drive growth [36] Question: How has the company historically managed store closures and consumer retention? - Management indicated that they are actively working to ensure smooth transitions for consumers during pharmacy closures, emphasizing the strength of the GoodRx brand [42][45] Question: What is the impact of the shift to cost-plus pricing by larger PBMs on the company's legacy model? - Management stated that a significant portion of their business already operates on cost-plus pricing, and they remain indifferent to the reimbursement mechanism [54] Question: Is there still an opportunity with GLP medications? - Management confirmed that opportunities with GLP medications continue to exist, and they are in discussions with manufacturers to enhance consumer access [58] Question: How does the company view its exposure to Medicare beneficiaries? - Management noted that less than 30% of users are Medicare eligible, and the impact of changes in Medicare out-of-pocket costs is minimal [93][95] Question: What is the company's strategy regarding biosimilars? - Management expressed optimism about the uptake of biosimilars and their alignment with the company's affordability narrative [97]

Core Insights - GoodRx Holdings, Inc. reported revenue of $202.97 million for Q1 2025, a year-over-year increase of 2.6% and an EPS of $0.09, compared to $0.08 a year ago [1] - The reported revenue exceeded the Zacks Consensus Estimate of $202.59 million, resulting in a surprise of +0.19% [1] - The company did not deliver an EPS surprise, as the consensus EPS estimate was also $0.09 [1] Performance Metrics - GoodRx's shares returned +4.2% over the past month, while the Zacks S&P 500 composite increased by +10.6% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential outperformance against the broader market in the near term [3] Key Company Metrics - Monthly Active Consumers: 6 million, below the estimated 7 million [4] - Subscription plans: 680 thousand, slightly below the estimated 685 thousand [4] - Revenue from Prescription transactions: $148.92 million, exceeding the estimate of $146.53 million, representing a +2.4% year-over-year change [4] - Revenue from Other sources: $4.38 million, below the estimate of $5.47 million, reflecting a year-over-year decline of -18.5% [4] - Revenue from Pharma manufacturer solutions: $28.65 million, slightly below the estimate of $29.90 million, but showing a +16.9% year-over-year increase [4] - Revenue from Subscription: $21.02 million, above the estimate of $20.79 million, but down -7% year-over-year [4]

Core Viewpoint - GoodRx Holdings, Inc. reported quarterly earnings of $0.09 per share, matching the Zacks Consensus Estimate, and showing an increase from $0.08 per share a year ago [1] - The company posted revenues of $202.97 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 0.19% and up from $197.88 million year-over-year [2] Financial Performance - GoodRx's earnings have not surpassed consensus EPS estimates over the last four quarters [1] - The company has topped consensus revenue estimates only once in the past four quarters [2] - The current consensus EPS estimate for the upcoming quarter is $0.10 on revenues of $205.65 million, and for the current fiscal year, it is $0.40 on revenues of $824.14 million [7] Market Performance - GoodRx shares have declined approximately 8.4% since the beginning of the year, compared to a 4.7% decline in the S&P 500 [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating expectations of outperforming the market in the near future [6] Industry Outlook - The Medical Services industry, to which GoodRx belongs, is currently ranked in the top 27% of over 250 Zacks industries, suggesting a favorable outlook [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact GoodRx's stock performance [5]

Revenue Performance - Revenue increased by 3% to $203.0 million from $197.9 million[102] - Total revenue for Q1 2025 was $202.97 million, a 1.1% increase from $197.88 million in Q1 2024[120] - Prescription transactions revenue increased by $3.5 million, or 2%, year-over-year, totaling $148.92 million in Q1 2025[123] - Subscription revenue decreased by $1.6 million, or 7%, year-over-year, totaling $21.02 million in Q1 2025[124] - Pharma manufacturer solutions revenue increased by $4.1 million, or 17%, year-over-year, totaling $28.65 million in Q1 2025[125] Profitability - Net income was $11.1 million with a net income margin of 5.4%, compared to a net loss of $1.0 million and a net loss margin of 0.5% in the previous year[102] - Operating income for Q1 2025 was $23.38 million, compared to $7.38 million in Q1 2024[122] - Net income for Q1 2025 was $11.05 million, a significant improvement from a net loss of $1.01 million in Q1 2024[122] - Adjusted EBITDA rose to $69.8 million, with an Adjusted EBITDA Margin of 34.4%, up from $62.8 million and 31.7% respectively[102] Consumer Metrics - Monthly Active Consumers decreased to 6.4 million in Q1 2025 from 6.7 million in Q1 2024[106] - Subscription plans totaled 680,000 as of March 31, 2025, down from 778,000 a year earlier[108] - The company expects a year-over-year decline in Monthly Active Consumers in the near term due to changes in retail pharmacy reimbursement models[105] Cash Flow and Financial Position - Cash and cash equivalents as of March 31, 2025, were $301.0 million, with $91.7 million available under a revolving credit facility[135] - Net cash provided by operating activities decreased by $33.2 million year-over-year, totaling $9.41 million in Q1 2025[142] - Net cash used in investing activities increased by $31.3 million year-over-year, primarily due to a $30.0 million increase in cash paid for business acquisition[143] - General and administrative expenses decreased by $11.5 million, or 28%, year-over-year, totaling $29.63 million in Q1 2025[130] Strategic Outlook - Revenue from Rite Aid is forecasted to be less than 5% of total revenue in 2025 due to store closures and bankruptcy proceedings[100] - The company aims to build a leading consumer-focused digital healthcare platform in the U.S. to address rising copays on prescription medications[99] - The company anticipates that prescription volume will migrate to other in-network pharmacies despite the adverse impact from retail pharmacy changes[100] - Adjusted Revenue for Q1 2025 was equal to reported revenue, excluding client contract termination costs[110]

Revenue Performance - First Quarter 2025 revenue increased by 3% to $203.0 million compared to $197.9 million in the same period last year[3] - Total revenue for Q1 2025 was $202.97 million, up 2.2% from $197.88 million in Q1 2024[30] - Revenue for Q1 2025 was $202,970,000, a 1.1% increase from $197,880,000 in Q1 2024[45] - For the full year 2025, the company anticipates revenue between $810 million and $840 million, representing a 2% to 6% growth compared to 2024[12] Segment Performance - Prescription transactions revenue rose by 2% to $148.9 million, driven by improved unit economics, despite a 4% decrease in Monthly Active Consumers[4] - Subscription revenue decreased by 7% to $21.0 million, primarily due to the discontinuation of the Kroger Savings Club partnership[5] - Pharma manufacturer solutions revenue increased by 17% to $28.6 million, reflecting organic growth and expanded market penetration[6] Profitability Metrics - Net income for the first quarter was $11.1 million, with a net income margin of 5.4%, compared to a net loss of $1.0 million in the prior year[6] - Net income for Q1 2025 was $11.05 million, a significant improvement from a net loss of $1.01 million in Q1 2024[30] - Adjusted Net Income for Q1 2025 was $34,363,000, compared to $32,586,000 in Q1 2024, showing a year-over-year increase of 5.4%[45] - Basic earnings per share for Q1 2025 was $0.03, compared to $(0.00) in Q1 2024, indicating a positive shift in profitability[45] Operational Efficiency - Adjusted EBITDA was $69.8 million, with an Adjusted EBITDA margin of 34.4%, up from 31.7% in the previous year[7] - Adjusted EBITDA for Q1 2025 reached $69,805,000, up from $62,787,000 in Q1 2024, indicating a growth of approximately 16%[42] - Adjusted EBITDA margin for Q1 2025 was 34.4%, up from 31.7% in Q1 2024, reflecting improved operational efficiency[42] - Operating income for Q1 2025 was $23.38 million, compared to $7.38 million in Q1 2024, an increase of 216.5%[30] - Operating income for Q1 2025 was $23,380,000, significantly higher than $7,381,000 in Q1 2024, indicating strong operational performance[49] Cash Flow and Assets - Cash flow from operating activities was $9.4 million, down from $42.6 million in the same quarter last year[8] - Cash and cash equivalents decreased to $300.98 million as of March 31, 2025, down from $448.35 million at the end of 2024, a reduction of 32.9%[27] - Total assets decreased to $1.30 billion in March 2025 from $1.39 billion in December 2024, a decline of 6.7%[27] - Total liabilities decreased to $640.92 million in March 2025 from $663.41 million in December 2024, a reduction of 3.4%[28] Consumer Metrics - The company exited the first quarter with over 7 million prescription-related consumers using GoodRx services[24] - Monthly Active Consumers decreased to 6.4 million in March 2025 from 6.6 million in December 2024, representing a decline of 3%[25] - Subscription plans decreased to 680,000 in March 2025 from 778,000 in March 2024, a decline of 12.6%[25] Cost Management - Total stock-based compensation expense for Q1 2025 was $19,174,000, down from $25,096,000 in Q1 2024, suggesting cost management efforts[45] - General and administrative expenses decreased to $29,630,000 in Q1 2025 from $41,108,000 in Q1 2024, representing a reduction of approximately 28%[47] Acquisition Costs - The company incurred $30 million in acquisition costs during Q1 2025[32] Future Guidance - Adjusted EBITDA guidance for 2025 is now between $273 million and $287 million, indicating a 5% to 10% growth compared to the previous year[12] - Adjusted EBITDA for Q1 2025 is expected to align with revenue, indicating stable operational performance moving forward[34]