Wells Fargo has increased its price target for Phreesia to $10 from $9 while maintaining an Equal Weight rating, citing growth in the company’s network segment.
The firm highlighted a 9% year-over-year expansion in Phreesia’s network segment during the second fiscal quarter, alongside a 4% increase in prescriptions driven by a GLP-1-focused pilot project. Adjusted EBITDA reached $32.9 million, exceeding Wells Fargo’s forecast by 8% and the consensus estimate by the same margin. The adjusted EBITDA margin stood at 25.4%, above the firm’s projection of 23.5% and the consensus of 23.6%.
Phreesia reported second-quarter revenue of $129.5 million, matching Wells Fargo’s estimate and consensus, representing a 10% increase from the prior-year period. Adjusted earnings per share totaled $0.03, falling short of the $0.09 estimate. Subscription revenue declined 2% year-over-year, while AHCS revenue grew 3%.
Phreesia’s market capitalization remains at $732 million. The company’s trailing twelve-month revenue growth stands at 14%.
Wells Fargo’s revised price target reflects confidence in Phreesia’s operational improvements despite the mixed quarterly results.
