Core Viewpoint - HealthStream (HSTM) is currently viewed as a better value opportunity compared to Shopify (SHOP) based on various financial metrics and rankings [1]. Group 1: Zacks Rank and Earnings Outlook - HSTM has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook due to recent revisions in earnings estimates [3]. - In contrast, SHOP has a Zacks Rank of 4 (Sell), suggesting a less favorable earnings outlook [3]. Group 2: Valuation Metrics - HSTM's forward P/E ratio is 28.70, significantly lower than SHOP's forward P/E of 93.19, indicating that HSTM may be undervalued relative to SHOP [5]. - HSTM has a PEG ratio of 2.39, while SHOP's PEG ratio is higher at 3.77, suggesting that HSTM's earnings growth is more reasonably priced [5]. - HSTM's P/B ratio stands at 1.88, compared to SHOP's P/B of 17.11, further indicating that HSTM is more attractively valued [6]. Group 3: Value Grades - HSTM holds a Value grade of B, while SHOP has a Value grade of F, reinforcing the view that HSTM is the superior choice for value investors [6].

Core Viewpoint - HealthStream (HSTM) is currently viewed as a more attractive investment option compared to Shopify (SHOP) for value investors seeking undervalued stocks [1][3][7] Valuation Metrics - HSTM has a forward P/E ratio of 34.79, significantly lower than SHOP's forward P/E of 116.86, indicating HSTM may be undervalued [5] - The PEG ratio for HSTM is 2.90, while SHOP's PEG ratio stands at 4.73, suggesting HSTM has a better earnings growth outlook relative to its price [5] - HSTM's P/B ratio is 2.02, compared to SHOP's P/B of 17.63, further highlighting HSTM's relative valuation advantage [6] Earnings Outlook - HSTM is experiencing an improving earnings outlook, which enhances its attractiveness in the Zacks Rank model, indicating a positive trend in earnings estimates [3][7]

Core Viewpoint - HealthStream (HSTM) is currently positioned as a more attractive investment compared to Shopify (SHOP) based on various valuation metrics and Zacks Rank [1][3]. Valuation Metrics - HSTM has a forward P/E ratio of 34.93, significantly lower than SHOP's forward P/E of 110.41, indicating that HSTM may be undervalued relative to SHOP [5]. - The PEG ratio for HSTM is 2.91, while SHOP's PEG ratio stands at 4.47, suggesting that HSTM offers better value when considering expected earnings growth [5]. - HSTM's P/B ratio is 2.03, compared to SHOP's P/B of 16.64, further highlighting HSTM's relative undervaluation [6]. Zacks Rank and Value Grades - HSTM holds a Zacks Rank of 2 (Buy), indicating a stronger earnings outlook compared to SHOP, which has a Zacks Rank of 3 (Hold) [3]. - In terms of Value grades, HSTM has a grade of B, while SHOP has a grade of F, reinforcing the notion that HSTM is the better option for value investors [6].

Core Viewpoint - HealthStream's CEO, Robert A. Frist, Jr., has donated approximately $3.5 million worth of his personal shares to benefit employees, enhancing employee engagement and ownership in the company [1][3]. Employee Stock Contribution - A total of 146,286 shares will be distributed to over 700 employees who have worked at HealthStream for a minimum of three years, with the number of shares each employee receives increasing based on their years of service [2]. - Executives and certain senior management will not receive any shares from this contribution, ensuring that the benefit is directed solely to eligible employees [2]. Financial Impact - The transaction will result in a compensation expense of approximately $3.5 million and additional administrative expenses of about $275,000, which will be recorded in the fourth quarter of 2025 [3][4]. - The expected financial impact includes a decrease in operating income by $3.775 million, net income by $2.955 million, and earnings per share by $0.10 [4]. - The only effect on adjusted EBITDA will be the administrative expenses and employer payroll taxes associated with the share distribution [4]. Management Commentary - The CFO, Scott A. Roberts, emphasized that the financial impact is due to accounting treatment rather than operational performance, and the contribution is seen as a bonus for shareholders as it does not dilute existing equity [5]. - The CEO's generous contribution of personal shares is intended to foster a more engaged workforce while minimizing the financial burden on the company [5]. Company Overview - HealthStream is recognized as the largest ecosystem of platform-delivered workforce solutions in the healthcare industry, aimed at empowering healthcare professionals to deliver high-quality patient care [6].

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Core Viewpoint - HealthStream has announced a new share repurchase program, allowing the company to buy back up to $10 million of its common stock [1] Summary by Relevant Sections - **Share Repurchase Program** - The Board of Directors has approved a program for repurchasing shares, which may include purchases in the open market and under a Rule 10b5-1 plan [1] - The total amount authorized for repurchase is $10 million [1]

Financial Performance - Revenues of $76.5 million in Q3 2025, up 4.6% from $73.1 million in Q3 2024[61] - Operating income of $7.6 million in Q3 2025, up 16.5% from $6.5 million in Q3 2024[61] - Net income of $6.1 million in Q3 2025, up 6.3% from $5.7 million in Q3 2024[61] - Adjusted EBITDA of $19.1 million in Q3 2025, up 7.9% from $17.7 million in Q3 2024[61] - Revenues increased by $6.9 million, or 3%, to $224.4 million for the nine months ended September 30, 2025, compared to $217.4 million for the same period in 2024[80] - Subscription revenues rose by $7.5 million, or 4%, to $216.6 million, representing 97% of total revenues for the nine months ended September 30, 2025[81] - Net income for the nine months ended September 30, 2025, was $15.8 million, compared to $15.1 million for the same period in 2024, with EPS increasing to $0.52 from $0.50[88] - Adjusted EBITDA was $52.9 million for the nine months ended September 30, 2025, compared to $50.6 million for the same period in 2024[88] Revenue Composition - Subscription revenues increased by $4.0 million, or 6%, while professional services revenues decreased by $0.6 million, or 19% in Q3 2025 compared to Q3 2024[69] Cost and Expenses - Cost of revenues increased by $2.0 million, or 8%, to $26.5 million in Q3 2025, with cost of revenues as a percentage of revenues rising to 35% from 33%[70] - General and administrative expenses decreased by $1.2 million, or 13%, to $7.3 million in Q3 2025, representing 10% of revenues compared to 12% in Q3 2024[73] - Cost of revenues increased by $5.6 million, or 8%, to $78.4 million, with cost of revenues as a percentage of revenues rising to 35% from 33%[81] Cash Flow and Investments - Net cash provided by operating activities increased by $3.6 million to $50.1 million during the nine months ended September 30, 2025[95] - Net cash used in investing activities was $27.0 million for the nine months ended September 30, 2025, compared to $25.9 million for the same period in 2024[96] - Capital expenditures were $7.5 million in Q3 2025, compared to $6.8 million in Q3 2024, reflecting increased investment in product development[66] Shareholder Returns - The company repurchased 905,786 shares of common stock at an aggregate fair value of $25.0 million during the nine months ended September 30, 2025[103] Financial Position - The company has a working capital of $35.1 million as of September 30, 2025, down from $37.4 million at December 31, 2024[98] - The company has a $50.0 million revolving credit facility with no outstanding borrowings as of September 30, 2025[99] - The Company is in compliance with all covenants under its revolving credit facility as of September 30, 2025[105] - The Company had no outstanding debt as of September 30, 2025, but may face interest rate market risk with future borrowings[107] Cash and Investment Risks - Cash and investment balances were $92.6 million as of September 30, 2025, with a hypothetical 10% decrease in interest rates potentially reducing annual interest income by $0.3 million[107] - The Company is exposed to foreign currency risks related to revenues and operating expenses in currencies such as the Canadian dollar, New Zealand dollar, and Australian dollar[108] - The Company has not entered into foreign currency hedging contracts to date but may consider doing so in the future[109] - The Company's investment strategy focuses on highly rated securities to minimize principal loss risk, with limits on credit exposure to single issuers[110] - The investment portfolio includes strategic investments in early-stage healthcare technology companies to expand the ecosystem[111] - The Company may experience volatility in its financial statements due to changes in market prices and impairments of strategic investments[111] - Future results may differ materially from projected market risks due to actual market developments[112] Taxation - The effective tax rate was 26% for Q3 2025, compared to 23% for Q3 2024[76] - The company expects to record sublease income of approximately $0.8 million during the last three months of 2025 and $3.2 million annually thereafter[62]

Financial Data and Key Metrics Changes - The company achieved record quarterly revenues of $76.5 million, up 4.6% from the same quarter last year [10] - Operating income increased by 16.5% to $7.6 million, while net income rose 6.3% to $6.1 million [10] - Adjusted EBITDA reached a new high of $19.1 million, up 7.9%, with an Adjusted EBITDA margin of 25% compared to 24.2% last year [13][10] - Earnings per share (EPS) increased to $0.20 from $0.19 [10] Business Line Data and Key Metrics Changes - Subscription revenues grew by $4 million, or 5.7%, while professional service revenues declined by $0.6 million, or 18.6% [10] - CredentialStream revenue grew by 23%, ShiftWizard by 29%, and CompetencySuite by 18% [11] - Revenues from legacy applications declined by $1.7 million compared to last year, but the core business grew by 8% when excluding legacy impacts [11] Market Data and Key Metrics Changes - Remaining performance obligations were $621 million, up from $549 million year-over-year, with expectations of converting approximately 39% to revenue over the next 12 months [11] - The company reported a strong cash balance of $92.6 million at the end of Q3 2025, with no interest-bearing debt [9] Company Strategy and Development Direction - The recent acquisition of Versus 12 enhances the company's entry into the payer and health plan market, which is expected to grow significantly [5][6] - The company is focusing on developing its career networks, which provide value directly to healthcare professionals, alongside its enterprise application suites [19][20] - HealthStream aims to connect its career networks with enterprise solutions through its HStream technology platform, enhancing the value of both [20][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in the payer market and the synergies expected from the Versus 12 acquisition [34][35] - The company updated its financial guidance for the full year 2025, expecting consolidated revenues between $299.5 million and $301.5 million [17] - Management acknowledged challenges from declining legacy software revenues, estimating a $3 million drop in Q4, which could offset new growth [72] Other Important Information - The company maintains a disciplined approach to capital allocation, prioritizing organic investments, acquisitions, and returning profits to shareholders [14][15] - A quarterly cash dividend of $0.31 per share was declared, to be paid on November 28 [18] Q&A Session Summary Question: Can you provide more details on the Versus 12 acquisition and its market? - Management indicated that the payer market requires distinct solutions and that the acquisition brings valuable expertise and technology to better meet customer needs [34][35] Question: What are the expectations for Adjusted EBITDA margins in the future? - Management noted that the shift towards owning more content and higher-margin products could lead to upward pressure on margins, potentially reaching 30% over time [36][39] Question: Can you provide revenue details for Versus 12? - The expected revenue contribution from Versus 12 in Q4 is approximately $900,000, with a mix of subscription and consulting revenue [44][45] Question: What monetization strategies are being pursued for the career networks? - Management outlined several monetization strategies, including education offerings and job capabilities, with a focus on building value-added services for healthcare professionals [46][49] Question: Are there opportunities for brand marketing on the platform? - Management confirmed ambitions to model NurseGrid after platforms like LinkedIn and Doximity, recognizing the growing value of nurses in the healthcare industry [55][56] Question: What is the growth outlook for ShiftWizard in large organizations? - Management indicated that while ShiftWizard is not yet fully ready for the largest organizations, there is progress in securing contracts with upper middle-class enterprises [63]

Financial Data and Key Metrics Changes - The company achieved record quarterly revenues of $76.5 million, up 4.6% from the same quarter last year [12] - Operating income increased by 16.5% to $7.6 million, while net income rose by 6.3% to $6.1 million [6][12] - Adjusted EBITDA reached a new record high of $19.1 million, up 7.9% year-over-year [12][16] - Gross margin was 65.3%, slightly down from 66.5% in the prior year due to increased cloud hosting and software licensing costs [15] Business Line Data and Key Metrics Changes - Subscription product revenues increased by $4 million or 5.7%, while professional service revenues decreased by $600,000 or 18.6% [14] - CredentialStream grew by 23%, Shift Wizard by 29%, and Competency Suite by 18% [14][38] - Revenues from legacy applications declined by $1.7 million compared to last year, but the core business grew by 8% when excluding legacy impacts [14] Market Data and Key Metrics Changes - The company has over 25 active accounts in the payer market following the acquisition of Versus twelve, which enhances its capabilities in provider data management [7] - The total addressable market for the company's SaaS solutions includes 12.6 million healthcare professionals and nursing students in the U.S. [11] Company Strategy and Development Direction - The company is focused on expanding its career networks, which provide value directly to healthcare professionals, while also enhancing its enterprise application suites [26][28] - The acquisition of Versus twelve is expected to strengthen the company's position in the payer market and improve provider data management capabilities [7][21] - The company maintains a disciplined approach to capital allocation, prioritizing organic investments, acquisitions, dividends, and share repurchases [20] Management's Comments on Operating Environment and Future Outlook - Management updated financial guidance for the full year 2025, maintaining midpoints while narrowing ranges for key metrics [6][22] - The company anticipates approximately $900,000 in revenue contribution from the Versus twelve acquisition in Q4, offset by a $3 million expected decline in legacy products [22][94] - Management expressed optimism about the growth trajectory of its core solutions and the potential for higher margins due to a shift towards proprietary content [50][52] Other Important Information - The company ended the quarter with a cash balance of $92.6 million and no interest-bearing debt [11][19] - A quarterly cash dividend of $0.31 per share was declared, to be paid on November 28 [22] Q&A Session Summary Question: Can you provide more details on the Versus twelve acquisition and its market? - Management indicated that the acquisition enhances capabilities in provider data management and brings valuable expertise to the team, which will help meet market needs [43][46] Question: What are the prospects for adjusted EBITDA margins? - Management noted that the shift towards owning more content and higher-margin products could lead to upward pressure on margins over time [47][50] Question: Can you provide insights on the revenue mix from Versus twelve? - Management estimated a contribution of approximately $900,000 in Q4, with a mix of subscription and consulting revenue, but did not provide specific breakdowns [56] Question: What monetization strategies are being pursued for the career networks? - Management outlined several monetization strategies, including education offerings and job capabilities, with a focus on building value-added services for users [59][62] Question: Is Shift Wizard ready for larger organizations? - Management confirmed that while it is not fully ready for the largest organizations, there is a good pipeline of opportunities in the upper middle market [83] Question: What bundling strategies are being implemented for small hospitals? - Management discussed the introduction of a critical access bundle aimed at providing a comprehensive solution at a better price, addressing economic pressures faced by small hospitals [88]

Financial Performance - Revenues for Q3 2025 increased by $3.4 million, or 4.6%, to $76.5 million compared to $73.1 million in Q3 2024[5] - Operating income for Q3 2025 was $7.6 million, up 16.5% from $6.5 million in Q3 2024[6] - Net income for Q3 2025 was $6.1 million, a 6.3% increase from $5.7 million in Q3 2024[7] - Adjusted EBITDA for Q3 2025 was $19.1 million, up 7.9% from $17.7 million in Q3 2024[7] - Year-to-date revenues for 2025 were $224.4 million, an increase of 3.2% over $217.4 million for the same period in 2024[11] - Net income for the nine months ended September 30, 2025, increased to $15,808,000, up from $15,118,000, representing a growth of 4.6%[29] - Adjusted EBITDA for the nine months ended September 30, 2025, was $50,603,000, compared to $52,942,000 for the same period in 2024, a decrease of 4.4%[31] - The company expects net income for 2025 to be between $20,300,000 and $21,500,000[33] - The company anticipates adjusted EBITDA for 2025 to be between $69,500,000 and $71,500,000[33] Cash and Assets - Cash and cash equivalents at the end of the period were $53,544,000, down from $59,469,000, reflecting a decrease of 9.7%[29] - Total assets decreased from $510,766,000 to $499,930,000, a decline of approximately 2.6%[27] - Total current liabilities decreased from $115,693,000 to $112,496,000, a reduction of approximately 2.0%[27] Capital Expenditures and Stock Activity - Capital expenditures for Q3 2025 were $7.8 million[10] - The company repurchased 255,833 shares at an aggregate fair value of $6.9 million during Q3 2025[12] - The company repurchased common stock amounting to $25,018,000 during the nine months ended September 30, 2025[29] Acquisitions and Dividends - The company completed the acquisition of Virsys12 for $13.0 million in cash on October 8, 2025[4][13] - The company declared a quarterly cash dividend of $0.031 per share, payable on November 28, 2025[9][14] Deferred Revenue and Expenses - Deferred revenue increased from $84,227,000 to $85,687,000, an increase of approximately 1.7%[27] - Stock-based compensation expense for the nine months ended September 30, 2025, was $2,734,000, down from $3,285,000, a decrease of 16.7%[31]