**HealthEquity, Inc. (HQY) reported strong fiscal first-quarter 2027 results, with adjusted earnings per share of $1.24, beating the Zacks Consensus Estimate by 11.7%. This represents a 28% increase year-over-year. Revenues climbed 7% to $354.6 million, exceeding expectations due to growth in service, custodial, and interchange revenues. Gross profit surged 14.3% to $256.3 million, leading to a gross margin expansion of 450 basis points, reaching 72.3%.**
**Following this strong performance, HealthEquity raised its fiscal 2027 revenue guidance to $1.41-$1.42 billion, an increase from the previous estimate of $1.405-$1.415 billion. Adjusted earnings per share are now projected to range between $4.66 and $4.73, up from $4.56-$4.65. The company ended the quarter with $265.4 million in cash and equivalents, with total debt reducing to $942.6 million.**
**However, investors are advised to watch for risks including fluctuations in custodial yields, cybersecurity challenges, and competitive pressures from larger players like UnitedHealth Group and Webster Financial. Despite the positive trends, HealthEquity maintains a Zacks Rank #3 (Hold) while waiting for further confirmation of sustainable margin gains and guidance improvements.**
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