By Dan Victor
Phreesia, a recent Barron's stock pick, has Wall Street's attention.
In an early morning note on Wednesday, Mizuho Securities USA analyst Steven Valiquette initiated coverage on Phreesia with a buy-equivalent Outperform rating and a $36 target price. Shares of the healthcare software maker climbed 3.9% on the day, closing at $31.99, a new 52-week high.
Phreesia's Patient Intake Management software helps medical practices automate and digitize the patient check-in process. This platform handles everything from appointment scheduling and insurance verification to collecting patient information and payments, which saves healthcare organizations time and money while improving the patient experience. The company handled around one in seven of all patient visits in the U.S. last year, solidifying its place as the market leader in the space.
We previously highlighted Phreesia's impressive sales momentum and shift toward consistent profitability, which had been lacking in recent years, as a tailwind for the stock price.
Valiquette's report reiterated many of those themes while focusing on an "equally intriguing part of the investment thesis": Phreesia's high-margin advertising business.
The analyst noted that the company's Network Solutions segment, which allows pharmaceutical and life sciences companies to communicate directly with patients privately, has "kicked into high-gear post-Covid." Coupled with the growing user base, this diversifying revenue stream is seen as a significant catalyst for further expansion of profitability margins and earnings.
Valiquette and his team at Mizuho are forecasting $481 million in revenue for Phreesia this fiscal year, a 15% annual growth rate. The bank also estimates the company's adjusted earnings before interest, taxes, depreciation, and amortization, or Ebitda, will reach $90 million, a significant 144% increase from the previous year.
In terms of valuation, Phreesia is trading at a forward enterprise value to sales ratio of 3.2, a notable discount to its peer group of U.S. healthcare technology providers, including names like Doximity and Waystar Holding. Valiquette believes Phreesia's current valuation is "more compelling now versus most periods since the 2019 IPO."
Ultimately, Mizuho's bullish initiation on Phreesia follows a string of positive coverage on Wall Street. All 16 analysts polled by FactSet, Valiquette included, rate the stock as a Buy. The resounding message is that Phreesia is a high-quality small-cap that should deliver solid growth over the next few years.
Attention now turns to the company's coming second quarter earnings report set for September 4. Revenue for the quarter is estimated to be $102.1 million, a 19% jump from a year-ago. The consensus for adjusted earnings per share of $0.20, if confirmed, would reverse a loss of $0.03 in the period last year.
Investors will be closely monitoring key metrics such as the number of healthcare services clients, patient payment processing volume, and the overall cash flow trend.
Phreesia is up 18% since its selection as a Barron's stock pick.
Write to Dan Victor at dan.victor@barrons.com
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August 27, 2025 17:15 ET (21:15 GMT)
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