Barclays has reduced its price target on Hinge Health Inc (HNGE) to $52.00 from $60.00, while keeping an Overweight recommendation on the shares. The stock is trading at $38.85, roughly 37% below its 52-week peak of $62.18, with technical indicators suggesting the name is in oversold territory according to InvestingPro data.
In its review of Hinge Health’s fourth-quarter results, Barclays identified three principal takeaways. First, billings improved, a shift Barclays attributes to increased engagement among members. The firm noted that yields expanded to 3.9% for the year, a development Barclays links to additions of new clients and longer-term repeat engaging members.
Second, Barclays pointed out the company’s progress toward a pricing mix shift: roughly half of eligible lives are now under engagement-based pricing. Management expects 24.4 million eligible lives in fiscal 2026 — a figure Barclays says implies about 21% billings growth if yields and average selling prices (ASPs) remain constant year-over-year.
Third, the research house highlighted margin dynamics. Gross margins, Barclays observed, are expanding by about 100 basis points year-over-year, while EBIT margins have widened by roughly 50 basis points on the same basis. The differential, it noted, reflects current investments into HingeSelect rollouts, faster product development, and potential moves into adjacencies beyond musculoskeletal (MSK) care. InvestingPro data shows Hinge Health reporting a gross profit margin of 78.82%.
Barclays recalculated its valuation using a multiple framework that targets approximately 5x 2027 EV/Sales. The firm said that this valuation point triangulates to about 18x 2027 EV/FCF, and it adjusted the price target accordingly to $52. Barclays’ move sits within a broader analyst landscape where price targets range from $48 to $72, suggesting what analysts see as notable upside from current levels.
The quarter itself delivered notable outperformance on several metrics. Hinge Health posted fourth-quarter earnings per share of $0.49, well ahead of a $0.14 consensus expectation. Quarterly revenue reached $171 million, up 46% from the year-ago period. Despite this momentum, the company has not been profitable over the last twelve months; however, analysts tracked by InvestingPro project the firm will reach profitability this year, with an EPS forecast of $1.57 for fiscal 2025.
Following Hinge Health’s quarterly disclosure, other brokerages revised their targets and affirmed positive views. RBC Capital trimmed its target to $50 from $60 while maintaining an Outperform rating and pointing to strong revenue and margin expansion. Citizens reiterated a Market Outperform rating and set a $65 target, citing robust results and efficient guidance for 2026. Needham reiterated a Buy rating with a $59 target, noting a strong finish to fiscal 2025 and constructive initial guidance for fiscal 2026, characterizing Hinge Health as an AI-driven disrupter in digital health.
Market positioning and outlook
Barclays’ notes on pricing mix, engagement, and margin progression frame the firm’s updated target. The tension between expanding gross margins and more modest EBIT improvement underscores that Hinge Health is directing cash toward product rollout efforts, such as HingeSelect, and into potential adjacent markets. Barclays’ assumptions around eligible lives and the sensitivity of billings to yield and ASPs are central to its billings growth projection for fiscal 2026.
Context for investors
- Current share price: $38.85 — materially below the 52-week high of $62.18.
- Yields for the year expanded to 3.9%.
- Eligible lives expected at 24.4 million for fiscal 2026, implying ~21% billings growth if yields and ASPs stay flat.
- Gross margin reported at 78.82%; gross margin expansion outpacing EBIT margin gains.
- Analyst EPS forecast for FY2025: $1.57, with the company delivering EPS of $0.49 in Q4 versus a $0.14 estimate.
These items will remain focal points for investors monitoring how improvements in engagement and pricing translate into cash flow and adjusted profitability as investments continue.