Healthcare services provider Premier beats Q4 revenue estimates

Overview

• Premier fiscal Q4 revenue decreases 12% yr/yr but beats analyst expectations

• Adjusted EPS for fiscal Q4 beats consensus, despite contract renewal challenges

• Co completes $200 mln accelerated share repurchase program, returning capital to shareholders

Outlook

• Premier expects fiscal-year 2026 net revenue of $940 mln to $1 bln excluding Contigo Health

• Company forecasts fiscal-year 2026 adjusted EBITDA of $230 mln to $245 mln

• Premier anticipates fiscal-year 2026 adjusted EPS of $1.33 to $1.43

• Company projects Supply Chain Services revenue of $590 mln to $620 mln for fiscal-year 2026

Result Drivers

• SUPPLY CHAIN SERVICES - Better-than-anticipated results in Supply Chain Services segment drove revenue and profitability above company expectations, per CEO Michael J. Alkire

• ADMINISTRATIVE FEES - Decrease in Supply Chain Services net revenue by 8% largely due to lower net administrative fees revenue, which fell 10% year-over-year

• PERFORMANCE SERVICES DECLINE - Performance Services segment revenue decreased 20% from prior-year period, driven by lower consulting revenue and timing of license revenue

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 7 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the medical equipment, supplies & distribution peer group is "buy."

• Wall Street's median 12-month price target for Premier Inc is $22.00, about 11% below its August 18 closing price of $24.43

• The stock recently traded at 18 times the next 12-month earnings vs. a P/E of 15 three months ago

Press Release: ID:nBw7N2RFja