Is NASDAQ:HQY on the Verge of a Major Breakout as a Strong Growth Stock?

Growth investors are on the lookout for stocks displaying robust revenue and EPS growth. In this analysis, we'll assess whether HEALTHEQUITY INC (NASDAQ:HQY) aligns with growth investing criteria, especially as it consolidates and signals a possible breakout. As always, investors should conduct their own research, but HEALTHEQUITY INC has surfaced on our radar for growth with base formation, warranting further examination.

Analyzing Growth Metrics

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:HQY has achieved a 8 out of 10:

• The Earnings Per Share has grown by an impressive 67.41% over the past year.
• HQY shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.50% yearly.
• Looking at the last year, HQY shows a quite strong growth in Revenue. The Revenue has grown by 15.99% in the last year.
• Measured over the past years, HQY shows a very strong growth in Revenue. The Revenue has been growing by 28.33% on average per year.
• Based on estimates for the next years, HQY will show a very strong growth in Earnings Per Share. The EPS will grow by 24.79% on average per year.
• HQY is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.70% yearly.
• When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

Health Assessment of NASDAQ:HQY

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NASDAQ:HQY has earned a 7 out of 10:

• HQY has an Altman-Z score of 4.38. This indicates that HQY is financially healthy and has little risk of bankruptcy at the moment.
• HQY has a better Altman-Z score (4.38) than 83.62% of its industry peers.
• Looking at the Debt to FCF ratio, with a value of 4.45, HQY is in the better half of the industry, outperforming 72.41% of the companies in the same industry.
• HQY has a Debt/Equity ratio of 0.43. This is a healthy value indicating a solid balance between debt and equity.
• HQY has a better Debt to Equity ratio (0.43) than 63.79% of its industry peers.
• A Current Ratio of 4.76 indicates that HQY has no problem at all paying its short term obligations.
• HQY has a Current ratio of 4.76. This is amongst the best in the industry. HQY outperforms 92.24% of its industry peers.
• HQY has a Quick Ratio of 4.76. This indicates that HQY is financially healthy and has no problem in meeting its short term obligations.
• HQY has a Quick ratio of 4.76. This is amongst the best in the industry. HQY outperforms 92.24% of its industry peers.

Exploring NASDAQ:HQY's Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:HQY has earned a 6 out of 10:

• Looking at the Return On Assets, with a value of 1.76%, HQY is in the better half of the industry, outperforming 65.52% of the companies in the same industry.
• With a decent Return On Equity value of 2.74%, HQY is doing good in the industry, outperforming 66.38% of the companies in the same industry.
• The last Return On Invested Capital (3.12%) for HQY is above the 3 year average (1.69%), which is a sign of increasing profitability.
• The Profit Margin of HQY (5.58%) is better than 82.76% of its industry peers.
• HQY has a Operating Margin of 12.82%. This is amongst the best in the industry. HQY outperforms 91.38% of its industry peers.
• Looking at the Gross Margin, with a value of 62.29%, HQY belongs to the top of the industry, outperforming 84.48% of the companies in the same industry.

How does the Setup look for NASDAQ:HQY

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the level of consolidation in the stock based on multiple short-term technical indicators. Currently, NASDAQ:HQY has a 8 as its setup rating, indicating its current consolidation status.

HQY has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a support zone below the current price at 79.78, a Stop Loss order could be placed below this zone.

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For an up to date full fundamental analysis you can check the fundamental report of HQY

Check the latest full technical report of HQY for a complete technical analysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.