PFMT - Performant Financial: No Earnings Inflection Anytime Soon Hold

2024-03-18 20:41:52 ET

Summary

• Performant Financial reported fourth quarter and full-year 2023 results largely in line with updated projections provided on the Q3 conference call in November.
• Healthcare revenues of $106.4 million increased by 12.4% year-over-year and represented 93.6% of total revenues, while Adjusted EBITDA of $3.3 million more than tripled.
• However, $4.1 million in capital expenditures resulted in slightly negative free cash flow for the year.
• On the conference call, management guided for another year of moderate growth in the core healthcare business and a slight improvement in Adjusted EBITDA.
• With potential earnings inflection still a couple of years in the future, I don't see any compelling reason to initiate new or add to existing positions at this point. Consequently, I am reiterating my "Hold" rating on the shares.

Note:

I have covered Performant Financial Corporation or "Performant Financial" ( PFMT ) previously, so investors should view this as an update to my earlier articles on the company. ...

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