Investor Confidence is Falling for HMS Holdings Corp. (NASDAQ:HMSY)

Investor Confidence is Falling for HMS Holdings Corp. (NASDAQ:HMSY)

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The HMS Holdings Corp. (HMSY) shares are trading at lower $30.78 and the avg recommendation for the stock is Strong Buy. The current analyst price target stands at $33.18.

To add more color to this target, the company’s high over the last year is $40.67 and the low is $18.19. Over the last 52 weeks, HMSY is down -24.32% while the S&P 500 is down -2.38%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, HMSY reported a profit of $142.16 million. HMS Holdings Corp. also saw revenues increase to $171.41 million. In addition, HMSY has free cash flow of $12.08 million as of 03-2020 The company’s EBITDA came in at $30.3 million which compares well with its peers.

HMSY booked profit margins of 12.40%, its Return on Equity (ROE) is 9.50%, and its Return on Assets is 6.60%. All told, it is clear that, HMSY needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. HMSY has a short ratio of 3.43 and outstanding shares of 88.20M.

Company Outlook

HMSY has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 0.52 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 0.91. HMS Holdings Corp. HMSY also noted assets of $1.25 billion at the end of the last quarter. Investors should also keep an eye on sector updates as HMSY has historically followed its peers on positive news.

All told, HMS Holdings Corp. HMSY has strung together solid data and demonstrated underlying fundamentals. At its current valuation, HMSY represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

HMS Holdings Corp. HMSY is now commanding a market cap of 2.76B and a float of 86.94M. HMSY is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of HMSY stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in HMSY, either long or short, and we have not been compensated for this article.