Progyny, Inc. (PGNY) experienced a significant stock decline on Wednesday after revealing disappointing third-quarter sales results and issuing FY24 revenue guidance that fell short of analyst expectations. The company’s quarterly earnings came in at 11 cents per share, missing the analyst consensus estimate of 13 cents per share. Additionally, its quarterly sales of $286.63 million missed the analyst consensus estimate of $296.88 million.
Progyny attributed the lower-than-expected revenue and profitability to a discrepancy in member utilization patterns. While the utilization rate aligned with the company’s August projections, members took longer than anticipated to progress through their treatment plans, leading to a lower-than-expected overall consumption of treatments.
Despite the disappointing results, Progyny’s CEO, Pete Anevski, emphasized the company’s fundamental strength and its leading position in a rapidly growing market. Progyny projects FY24 earnings of $1.54 to $1.57 per share on revenue of $1.135 billion to $1.150 billion.
Following the earnings announcement, several analysts adjusted their price targets on Progyny stock. Truist Securities analyst Jailendra Singh downgraded Progyny from Buy to Hold, lowering the price target from $26 to $19. Canaccord Genuity analyst Richard Close maintained a Hold rating on Progyny but reduced the price target from $18 to $17.
Investors are now left to grapple with the implications of Progyny’s underperformance and the revised analyst assessments. The company’s optimistic outlook about its long-term prospects in a growing market remains a point of consideration for those considering buying PGNY stock.
