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Accolade (ACCD)
NASDAQ:ACCD
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Accolade
(NASDAQ:ACCD)
58Neutral
Positive Factors
Acquisition
The acquisition by Transcarent represents a premium of approximately 110% compared to the previous closing price.
Scale and Resources
The combined entity is expected to benefit from incremental scale and complementary technology/service resources.
Strategic Benefits
The strategic acquisition is seen as logical and synergistic, enhancing AI capabilities in ACCD's operations.
Negative Factors
Guidance Withdrawal
The company is withdrawing its prior guidance for FY25 and will not host the previously scheduled call.
Revenue Forecast
FY25 revenue is projected at $441.7M vs. guidance calling for $467.5M at the midpoint.
Stock Downgrade
A competing bid is less likely, leading to a downgrade from Buy to Hold and a price target reduction to $7.03.
Accolade (ACCD) vs. S&P 500 (SPY)
Market Cap
$574.77M
Dividend YieldN/A
Average Volume (3M)1.05M
Price to Earnings (P/E)―
Beta (1Y)1.05
Revenue Growth14.99%
EPS Growth-35.83%
CountryUS
Employees2,400
SectorHealthcare
Sector Strength78
IndustryMedical - Healthcare Information Services
Share Statistics
EPS (TTM)-2.25
Shares Outstanding81,993,060
10 Day Avg. Volume519,804
30 Day Avg. Volume1,050,530
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.28
Price to Cash Flow (P/CF)-14.70
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$8.69Price Target Upside23.97% Upside
Rating ConsensusHold
Number of Analyst Covering11
Accolade Business Overview & Revenue Model
Company DescriptionAccolade, Inc., together with its subsidiaries, develops and provides technology-enabled solutions that help people to understand, navigate, and utilize the healthcare system and their workplace benefits in the United States. The company offers a platform with cloud-based technology and multimodal support from a team of health assistants and clinicians, including nurses, physician medical directors, and behavioral health specialists. It also provides second opinion consultation and health care decision support services. The company serves employers who provide their employees and their employees' families a single place to turn for their health, healthcare, and benefits needs. Accolade, Inc. was incorporated in 2007 and is headquartered in Plymouth Meeting, Pennsylvania.
How the Company Makes MoneyAccolade generates revenue primarily through contracts with employers and health plans who pay for access to its platform and services. The company offers its solutions on a subscription basis, typically charging a per-member-per-month fee. This fee structure is often tied to the number of employees enrolled in the services provided by Accolade. Additionally, Accolade may receive performance-based payments contingent on achieving specific healthcare outcomes or cost savings benchmarks for its clients. Significant partnerships with health plans and large employers expand its market reach, contributing to its revenue streams.
Accolade Financial Statement Overview
Summary
Accolade demonstrates strong revenue growth but faces significant profitability and cash flow challenges, with recurring losses and negative cash flows. The balance sheet remains stable with low leverage, but the decline in equity ratio warrants attention. The company must address its profitability and cash flow issues to enhance financial health.Income Statement
Accolade shows strong revenue growth, with a 13% increase in TTM compared to the previous year. However, high EBIT and net income losses indicate significant profitability challenges. Gross profit margin is healthy at 42.9% but is overshadowed by negative EBIT and EBITDA margins, reflecting high operating costs.45
Neutral
Balance Sheet
The company's debt-to-equity ratio is low at 0.09, suggesting manageable leverage. However, the equity ratio has decreased to 48.3%, indicating diminishing equity compared to total assets. The return on equity remains negative due to recurring losses, reflecting ongoing profitability struggles.55
Neutral
Cash Flow
Accolade's free cash flow remains negative, with a concerning decline of 65% in the TTM period. The operating cash flow to net income ratio is poor, highlighting inefficiencies. Free cash flow to net income ratio is also negative, emphasizing challenges in generating cash from operations.40
Negative
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 446.72M | 414.29M | 363.14M | 310.02M | 170.36M | 132.51M |
| Gross Profit | |||||
| 191.72M | 192.06M | 164.24M | 141.00M | 76.69M | 58.82M |
| EBIT | |||||
| -184.43M | -114.45M | 135.90M | -171.14M | -46.78M | -48.20M |
| EBITDA | |||||
| -45.56M | -69.29M | -110.34M | -130.92M | -38.71M | -39.80M |
| Net Income Common Stockholders | |||||
| -180.30M | -99.81M | -459.65M | -123.12M | -50.65M | -51.37M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 321.08M | 237.03M | 321.08M | 365.85M | 433.88M | 84.32M |
| Total Assets | |||||
| 903.07M | 788.15M | 903.07M | 1.29B | 475.51M | 124.41M |
| Total Debt | |||||
| 317.39M | 241.65M | 316.80M | 319.74M | 0.00 | 72.31M |
| Net Debt | |||||
| -3.69M | 55.93M | -4.29M | -46.11M | -433.88M | -12.01M |
| Total Liabilities | |||||
| 429.28M | 342.69M | 429.28M | 429.74M | 84.66M | 148.19M |
| Stockholders Equity | |||||
| 473.79M | 445.46M | 473.79M | 855.79M | 390.85M | -23.77M |
| Cash Flow | Free Cash Flow | ||||
| -9.90M | -28.65M | -47.93M | -65.97M | -27.60M | -37.56M |
| Operating Cash Flow | |||||
| -6.76M | -16.17M | -40.70M | -62.35M | -25.23M | -34.25M |
| Investing Cash Flow | |||||
| -43.55M | -63.63M | -7.23M | -263.61M | -2.42M | -3.52M |
| Financing Cash Flow | |||||
| 6.22M | -55.57M | 3.16M | 257.93M | 428.38M | 28.22M |
Accolade Technical Analysis
Positive
7.01
Price Trends
6.94
Positive
5.55
Positive
4.77
Positive
Market Momentum
0.06
Positive
68.37
Neutral
22.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACCD, the sentiment is Positive. The current price of 7.01 is above the 20-day moving average (MA) of 6.99, above the 50-day MA of 6.94, and above the 200-day MA of 4.77, indicating a bullish trend. The MACD of 0.06 indicates Positive momentum. The RSI at 68.37 is Neutral, neither overbought nor oversold. The STOCH value of 22.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ACCD.
Accolade Risk Analysis
Accolade disclosed 60 risk factors in its most recent earnings report. Accolade reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Accolade Peers Comparison
Overall Rating
UnderperformOutperform
Sector (48)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $542.82M | 776.79 | 0.26% | ― | 11.29% | -79.52% | |
66 Neutral | $570.44M | 32.94 | 4.31% | ― | 51.09% | ― | |
58 Neutral | $574.77M | ― | -48.23% | ― | 14.99% | -35.83% | |
57 Neutral | $591.56M | ― | -182.71% | ― | 432.03% | 14.41% | |
48 Neutral | $6.86B | 1.11 | -50.22% | 2.47% | 16.71% | 1.53% | |
46 Neutral | $549.37M | ― | -39.04% | ― | -10.30% | -14.44% | |
34 Underperform | $440.65M | ― | -31.60% | ― | ― | 6.72% |
* Healthcare Sector Average
Performance Comparison
ACCD
Accolade
7.01
-2.18
-23.72%
ANAB
AnaptysBio
19.29
-1.79
-8.49%
ORGO
Organogenesis Holdings
4.07
1.24
43.82%
CSTL
Castle Biosciences
19.19
-1.63
-7.83%
MRVI
Maravai Lifesciences Holdings
2.10
-5.85
-73.58%
TYRA
Tyra Bioscience
8.30
-9.70
-53.89%
Accolade Earnings Call Summary
Earnings Call Date: Jan 9, 2025 | % Change Since: 76.57% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Neutral
Accolade reported strong revenue and cash flow performance, with significant new wins and a robust cash position. However, challenges include potential delays in health plan deployments and increased pressure from ROI guarantees.Highlights
Revenue Exceeds Expectations
Accolade reported Q2 revenue of $106.4 million, surpassing the top of the guidance range.
Positive Cash Flow
The company generated positive free cash flow of approximately $3.1 million.
Strong Market Demand
Accolade noted strong demand across all segments, including strategic, enterprise, health plans, and government.
Significant New Wins
Accolade secured a notable competitive takeaway deal for 2nd.MD in the expert medical opinion space.
Strong Cash Position
Accolade ended the quarter with over $234 million in cash, cash equivalents, and marketable securities, improving its net cash position by nearly $20 million compared to the previous year.
Lowlights
Potential Delays in Health Plan Deployments
Some health plan deployments may occur later in the fiscal year, affecting the timing of revenue recognition.
Increased Focus on ROI Guarantees
Employers are pushing for more rigorous ROI guarantees due to rising healthcare costs, which could pressure margins.
Performance Guarantees Impact
The gross margin decline in Q2 was attributed to performance guarantees, which are expected to impact future quarters.
Company Guidance
During Accolade's Q2 2025 earnings call, the company highlighted several key metrics and provided forward-looking guidance. Accolade reported revenue of $106.4 million, which exceeded their guided range, and adjusted EBITDA also surpassed expectations, driven by early recognized performance guarantee (PG) revenue and effective expense management. The company generated positive free cash flow of approximately $3.1 million, ending the quarter with cash, cash equivalents, and marketable securities totaling over $234 million, positioning them with a net cash position of more than $23 million. For Q3, Accolade anticipates revenue between $104 million and $107 million and an adjusted EBITDA loss ranging from $3 million to $5 million. They reaffirmed their full-year guidance with projected revenue of $460 million to $475 million and adjusted EBITDA between $15 million and $20 million. The company emphasized a focus on profitability, expecting to double adjusted EBITDA over the next two years and continue generating positive cash flow.Accolade Corporate Events
Delistings and Listing ChangesM&A TransactionsShareholder Meetings
Accolade Stockholders Approve Merger with Transcarent
Neutral
Mar 27, 2025
On March 27, 2025, Accolade, Inc. held a special meeting where stockholders approved the merger with Transcarent, Inc. The merger, initially agreed upon on January 8, 2025, will result in Accolade becoming a privately held company, with its shares no longer listed on public markets. The transaction is expected to be completed in the second quarter of 2025, pending customary closing conditions and regulatory approvals. This merger is significant for Accolade’s operations and market positioning, as it aligns with Transcarent’s focus on providing accessible and affordable healthcare solutions.
Delistings and Listing ChangesM&A Transactions
Accolade Acquired by Transcarent in Strategic Merger
Positive
Jan 8, 2025
Transcarent, a healthcare platform focused on consumer empowerment, has announced its acquisition of Accolade, a leader in health advocacy, expert medical opinions, and primary care, for $7.03 per share in cash, totaling approximately $621 million. This strategic merger, approved by both companies’ boards, aims to create a unified platform combining Transcarent’s AI-powered WayFinding and care experiences with Accolade’s personalized healthcare services, promising enhanced healthcare access, improved outcomes, and reduced costs. The transaction is expected to close in the second quarter of 2025, subject to regulatory approvals and Accolade stockholder approval. Upon completion, Accolade will become a privately held company, and its stock will be delisted from Nasdaq.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.