GoodRx Holdings Inc. (GDRX) PT Raised to $8 at UBS

UBS analyst Kevin Caliendo raised the price target on GoodRx Holdings Inc. (NASDAQ: GDRX) to $8.00 (from $5.00) while maintaining a Neutral rating.

The analyst commented, " The positive 2024 guidance surprise and the announcement of a $450M share repurchase authorization (equates to 56M shares at our current $8 price target vs. 75.5M class A shares in the float) should support shares at current levels (~12x EV/ EBITDA). The positive 2024 topline development since January (+1-2%) incorporates incremental revenue from the integrated savings program (ISP), with further potential upside from additional mid-year enrollment. Equally positive was the 2024 EBITDA surprise (implying a +220bps margin ramp from 2023), benefitting from certain restructuring efforts (i.e. VitaCare de-emphasis) and operating leverage. The fundamental question that needs to be answered after the 4Q results is how sustainable the positive momentum is in the core prescription business. As of now, we are not modeling the same degree of annual EBITDA margin step-up going forward, and ISP will need to get closer to a predictable steady state before we can reasonably expect the core PTR business to grow faster beyond 2H25 than the LSD+ prescription volume market growth rate. But, the GDRX story is better today than it was last week and further validation of ISP as the year goes on could re-rate the shares even higher."

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