GoodRx Holdings (GDRX, Financial) experienced a significant stock price decline, falling by 17.51%, following unsatisfactory quarterly results. As of now, the stock is priced at $5.04.
The company reported a revenue of $195.3 million for the third quarter, marking an 8% increase compared to the same period last year. Despite this growth, GoodRx's non-GAAP net income was $31.9 million, or $0.08 per share, slightly below analysts' expectations of $0.09 per share. The revenue forecast of $195.7 million was also unmet.
In terms of business performance, GoodRx (GDRX, Financial) saw prescription transactions rise by 4%, totaling over $140 million. The number of monthly active consumers increased to 6.5 million from the previous 6.1 million. Additionally, the pharma manufacturer solutions segment experienced a robust 77% increase in revenue, exceeding $28 million.
Despite these gains, GoodRx's revenue guidance for the fourth quarter was underwhelming. The company projects approximately $200 million in revenue, forecasted to grow by only 2%, falling short of analysts' expectations of $206 million. For the full year, revenue is anticipated to grow by 6% to $794 million, under the consensus estimate of approximately $801 million.
From a valuation perspective, GoodRx (GDRX, Financial) has a market capitalization of $1.92 billion and a PB ratio of 3.45. However, the company does not currently have a P/E ratio, and its Altman Z-Score of 1.4 places it in the distress zone, suggesting a possibility of bankruptcy within the next two years. Despite the financial challenges, the company’s Beneish M-Score of -2.66 indicates it is unlikely to be a manipulator. The GF Value assessment, which you can view here, suggests the stock might be a "Possible Value Trap," advising investors to think twice.
GoodRx's financial health shows mixed signals, with a cash-to-debt ratio of 0.74 and an equity-to-asset ratio of 0.45. The revenue per share has been on a decline over the past three years, and the company's gross margin has similarly been in decline. Insider activity over the past three months saw two insider selling transactions, totaling 89,677 shares sold, while there were no insider purchases.
