Analyst David Hynes of Canaccord Genuity maintained a Hold rating on Definitive Healthcare Corp (DH – Research Report), with a price target of $5.00.
David Hynes has given his Hold rating due to a combination of factors impacting Definitive Healthcare Corp. Despite the company exceeding expectations in its recent quarterly results, ongoing issues with customer retention and downsell pressures have led to a conservative outlook for 2025. Management anticipates a revenue decline and a decrease in EBITDA margins, reflecting the challenges faced in maintaining growth momentum.
On a positive note, the company has been successful in acquiring new clients and forming strategic partnerships, which could enhance its platform’s value proposition. Additionally, efforts to realign sales and customer success teams are underway, aiming to improve retention and sales execution. However, with net revenue retention expected to remain low, significant transformation is needed before the company can achieve sustainable growth. Until there is clearer evidence of positive growth, the stock remains a Hold, despite its cash generation capabilities and the leadership of a new CEO with a strong turnaround track record.
In another report released today, Morgan Stanley also maintained a Hold rating on the stock with a $5.00 price target.
DH’s price has also changed slightly for the past six months – from $4.520 to $4.920, which is a 8.85% increase.