Value
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 0.0 |
| P/S | 8.4 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 4.3 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 28.7x
- ▸PEG: 0.01
LFST · Why this verdict
Why LifeStance Health Group (LFST) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.0/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The business is growing revenue at 21% year-over-year and ranks among the top performers in its industry peer group for growth rate, pointing to a large and accessible addressable market. Growth breakdown | Revenue growth sustains above 15% year-over-year for two consecutive reported quarters, confirming the trend is durable rather than a one-period acceleration. | →Stable |
| CounterThe growth estimate rests on a single data component with low analytical confidence; if the actual rate is closer to mid-single digits, the premium embedded in the current price-to-sales multiple is difficult to justify. | ||
The company converts stated net income to free cash flow at 606% while carrying a near-perfect financial-health score, signaling that cash generation is far stronger than reported earnings imply. Quality breakdown | Free cash flow remains above 200% of net income for the next twelve months, confirming that cash economics are not reverting toward reported-earnings parity. | →Stable |
| CounterA 606% conversion ratio almost certainly reflects accounting timing items such as non-cash charges or working capital swings rather than structurally superior cash economics; normalization could bring the figure closer to 100% and sharply alter the quality narrative. | ||
With only 6.9% of headroom to the take-profit level and a reward-to-risk ratio of 1.01-to-1, the price has risen to a point where the asymmetry requirement for entry is not met — gains are effectively capped near the current consensus target. Warnings | A price pullback over the next six months widens upside to the take-profit target beyond 15%, restoring the geometry required for a well-structured entry. | →Stable |
| CounterMomentum remains constructive — a golden cross formation, RSI at 67, and rising on-balance volume — and if analyst targets are revised higher, the asymmetry could improve without a price pullback. | ||
After an in-line result and then a significant miss of roughly 64%, the company delivered consecutive beats of 10% and 64% in the two most recent quarters, suggesting an improving execution trend. Earnings | EPS beats consensus in each of the next two reported quarters with no negative surprise, confirming the recent trajectory is durable. | →Stable |
| CounterThe prior 64% miss shows the business can swing dramatically versus estimates; a single quarter of underperformance could reset market confidence and reprice the stock sharply lower. | ||
The business is growing revenue at 21% year-over-year and ranks among the top performers in its industry peer group for growth rate, pointing to a large and accessible addressable market.
→StableGrowth breakdown
- Expectation
- Revenue growth sustains above 15% year-over-year for two consecutive reported quarters, confirming the trend is durable rather than a one-period acceleration.
CounterThe growth estimate rests on a single data component with low analytical confidence; if the actual rate is closer to mid-single digits, the premium embedded in the current price-to-sales multiple is difficult to justify.
The company converts stated net income to free cash flow at 606% while carrying a near-perfect financial-health score, signaling that cash generation is far stronger than reported earnings imply.
→StableQuality breakdown
- Expectation
- Free cash flow remains above 200% of net income for the next twelve months, confirming that cash economics are not reverting toward reported-earnings parity.
CounterA 606% conversion ratio almost certainly reflects accounting timing items such as non-cash charges or working capital swings rather than structurally superior cash economics; normalization could bring the figure closer to 100% and sharply alter the quality narrative.
With only 6.9% of headroom to the take-profit level and a reward-to-risk ratio of 1.01-to-1, the price has risen to a point where the asymmetry requirement for entry is not met — gains are effectively capped near the current consensus target.
→StableWarnings
- Expectation
- A price pullback over the next six months widens upside to the take-profit target beyond 15%, restoring the geometry required for a well-structured entry.
CounterMomentum remains constructive — a golden cross formation, RSI at 67, and rising on-balance volume — and if analyst targets are revised higher, the asymmetry could improve without a price pullback.
After an in-line result and then a significant miss of roughly 64%, the company delivered consecutive beats of 10% and 64% in the two most recent quarters, suggesting an improving execution trend.
→StableEarnings
- Expectation
- EPS beats consensus in each of the next two reported quarters with no negative surprise, confirming the recent trajectory is durable.
CounterThe prior 64% miss shows the business can swing dramatically versus estimates; a single quarter of underperformance could reset market confidence and reprice the stock sharply lower.
TrendMatrix Research · core thesis
Engine thesis — one sentence
LifeStance is generating 21% year-over-year revenue growth and converting earnings to free cash flow at an exceptional multiple of reported income, but the stock has risen to within 6.9% of its take-profit level with a reward-to-risk ratio barely above 1-to-1, leaving insufficient asymmetry to justify new entry at current prices.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.5 |
| ROA | 0.9 |
| Gross margin | 2.5 |
| Op margin | 2.2 |
| Net margin | 0.8 |
| Current ratio | 5.5 |
| FCF quality | 10.0 |
| Moat | 5.6 |
| Piotroski F | 8.9 |
- ▸Excellent cash conversion: 606% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
7.8/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 7.8 |
- ▸Strong growth: 21% YoY
Momentum
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.4 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 5.1 |
- ▸Overbought (RSI 91)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.1 |
| erm sentiment | 5.0 |
Insider
3.0/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 5.0 |
- ▸Heavy insider selling — $281,869,408 (6.550% of mkt cap)
Peer rank
2.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 0.1 |
| quality rank | 2.6 |
| growth rank | 8.0 |
Technical
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.7 |
| support resistance | 0.8 |
| 52w position | 9.4 |
| gap | 5.0 |
Risk (lower is worse)
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.8 |
| days to cover | 7.9 |
| volatility | 3.4 |
| put call | 7.9 |
| implied vol | 2.7 |
| max pain risk | 5.0 |
| beta | 6.5 |
| debt equity | 8.7 |
- ▸High IV: 64%
Catalyst
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 3.8 |
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- MOMENTUM:7.5>=5.5
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-1.2=NEGATIVE
- INSIDER:6.55%=EXTREME
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-1.24
Upside
-18.6%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $4.3B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.0 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 7.8) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.2=NEGATIVE, INSIDER:6.55%=EXTREME) reinforce the read. Current asymmetry R:R is -1.24 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 7.8, Momentum at 7.5, and Risk (lower is worse) at 6.2; the weakest are Peer rank at 2.7, Insider at 3.0, and Technical at 4.0. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -1.24 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Sector Leading Revenue Growth
Trip ifRevenue growth falls below 12% YoY for 2 consecutive reported quarters.
- P2Exceptional Free Cash Flow Conversion
Trip ifFree cash flow falls below 150% of net income for 2 consecutive quarters.
- P3Inadequate Entry Geometry
Trip ifUpside to the take-profit target expands beyond 15% for 5 consecutive trading sessions, indicating the stock has pulled back to an entry-worthy level.
- P4Earnings Execution Improving
Trip ifEPS surprise falls below 0% in any of the next 2 reported quarters.