LifeStance Health Group Inc. Common Stock (LFST)

FairStock Score: 44/100 — MIXED

Key Financials

Strengths

• Generates $113 million in annual free cash flow (4.2% yield on market cap)
• Strong Piotroski F-Score of 8/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• Conservative balance sheet with debt-to-equity of just 0.31, providing financial flexibility
• Revenue growth of 17.4% demonstrates strong top-line momentum
• Established organization with 10,961 employees providing operational scale

Concerns

• Trades significantly above Graham Number ($1) with negative 422% margin of safety—limited downside protection

AI Analysis

LifeStance Health Group Inc. Common Stock is a small-cap healthcare company valued at $2.7 billion. The business generates $1.4 billion in annual revenue with a 0.8% net margin and $113 million in free cash flow. From a quality standpoint, LifeStance shows near-perfect Piotroski F-Score of 8/9 indicating exceptional financial health and Altman Z-Score of 2.1 in the grey zone. On valuation, the stock is commanding a steep 349.5x multiple, with trades far above its Graham Number ($1) with no margin of safety. Growth dynamics show revenue growing at 17.4% and profit growth of 264.1%. Our composite FairStock Score of 44/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

LifeStance's 17% revenue growth trajectory could accelerate as it captures additional market share in the healthcare sector. With $113 million in annual free cash flow (4.2% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 350x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer