HealthEquity price target raised to $125 from $110 at Wells Fargo

Wells Fargo analyst Stan Berenshteyn raised the firm’s price target on HealthEquity (HQY) to $125 from $110 and keeps an Overweight rating on the shares as the firm sees factor favorable rate setup. There are several bills in play that could drive TAM upside for HealthEquity, including a bill that could push HSAs into the Medicare/Medicaid space, HSA Modernization that may increase HSA contribution limits, a bill that could decouple HSAs from HDHPs, and the HOPE act, which Wells previously estimated represents 4-times today’s HSA market and for HealthEquity a cross-sale opportunity worth about $1.5B.