Selectquote IncSLQT
▼ NegativeCapitalrelevance
Fiscal 2027 revenue guidance below fiscal 2026, Q4 net loss, and high debt costs overshadow cash flow focus.
Impact on stocks 1
Financials
Selectquote IncSelectQuote told investors on August 25 that cash generation, not growth, is now the entire point of owning the stock, even as fiscal 2026 revenue reached $1.62 billion, up 6% year over year, and operating cash flow climbed $44 million. The same release showed a fourth-quarter net loss of $16.8 million, a reversal from $12.9 million in net income a year earlier, and a fiscal 2027 guide pointing to revenue of $1.35 billion to $1.45 billion, roughly 14% below fiscal 2026 at the midpoint. Healthcare Services, built around the SelectRx pharmacy, generated $845 million in revenue for fiscal 2026, up 14%, and exited the fourth quarter at an annualized adjusted EBITDA run rate of nearly $50 million, roughly double the $25 million it produced across the full year. SelectQuote identified more than $30 million in annualized run rate savings from AI-enabled enrollment tools and workflow automation, while the Senior segment held a 26% adjusted EBITDA margin for a fourth straight year. The company faces $800 million in debt and preferred equity carrying a roughly 12% funding cost, translating into $45 million of annual cash interest, and expects Medicare Advantage approved policies to fall another 10% to 15% after already declining 4% this past year. Hedge fund ownership rose from 13 funds to 21 quarter over quarter, short interest sits at just 1.16% of float, and the stock trades at a forward price-to-earnings ratio of 66.67 as of September 1.
Selectquote IncFiscal 2027 revenue guidance below fiscal 2026, Q4 net loss, and high debt costs overshadow cash flow focus.