UPDATE: Compass Point Initiates Performant Financial at Buy on Growth

Compass Point initiated coverage on Performant Financial (NASDAQ: PFMT) with a Buy rating and an $11 price target.

Compass Point commented, "We view Performant as an early-stage growth story: student lending leading indicators of originations, delinquencies, and defaults are all accelerating, while increasing Medicare spend creates a significant pipeline of error recovery volume. Regulatory and concentration risk remain, but we expect the company's steady performance and long-term relationships with the Department of Education (ED) and Centers for Medicare and Medicaid Services (CMS) bode well for the key upcoming contract renewals, setting the stage for meaningful placement growth for several years."

Performant Financial closed at $9.20 on Tuesday.

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