Steve wardell Digital Health Marketing Deck

FOR INSTITUTIONAL USE ONLY
THE FUTURE OF DIGITAL HEALTH: CATCHING HEALTHCARE’S DIGITAL WAVE
June 2016
STEVEN WARDELL
DIGITAL HEALTH ANALYST
STEVEN.WARDELL@LEERINK.COM
617.639.3081
MATTHEW DELLELO, CFA
DIGITAL HEALTH ASSOCIATE
MATT.DELLELO@LEERINK.COM
617.918.4812
Please refer to the Disclosure Appendix for Analyst Certification. To access Price Charts and Disclosures specific to Covered
Companies, please refer to https://leerink.bluematrix.com/bluematrix/Disclosure2 or send a request to Leerink Partners
Editorial Department, One Federal Street, 37th Floor, Boston, MA 02110.
The description of Leerink Partners benchmarks is available by contacting the Leerink Partners Editorial Department.

• Proprietary Healthcare Research on:
- Next-gen healthcare IT (NUAN, PGND, IMPR)
- Digital pharma service (IMS, MDSO, VEEV)
- Online health media (WBMD, EVDY)
- Digital health benefits (HQY, WAGE, TDOC,
CSLT)
- Health consumerism (FIT, WBMD, EVDY)
• Investor Bus Tours & Booth Tours
• Healthcare & Technology Investor Conferences
2
STEVEN WARDELL
• Initiated coverage of Digital Health sector in
October 2014
• 16 years in digital health and life science,
including at PatientKeeper (mobile EMR) and
Activate Networks (big data healthcare analytics)
• Most extensive digital health research franchise
on Wall Street, and longest track record covering
sector

3
DIGITAL HEALTH OVERVIEW
Managed Care Employer R&D Commerical Hospital CIO Other Clinical Grade Cons. Grade
Nuance (NUAN) Press Ganey
(PGND)
Imprivata
(IMPR)
HealthStream
(HSTM)
Press Ganey
(PGND)
Everyday Health
(EVDY)
Medidata
(MDSO)
WebMD
(WBMD)
Vocera (VCRA) Omnicell
(OMCL)
Philips (PHG) Fitbit (FIT)
Healthways
(HWAY)
WageWorks
(WAGE)
Everyday Health
(EVDY)
Inovalon (INOV) Advisory Board
(ABCO)
Garmin (GRMN)
Castlight
(CSLT)
Model N
(MODN)
Evolent (EVH) NantHealth (NH) Weight
Watchers
(WTW)
Weight
Watchers
(WTW)
Philips (PHG) Mindbody (MB)
Care.com
(CRCM)
= covered by the Leerink Research Digital Health franchise
Digital Health Benefits Digital Pharma Services NextGen Healthcare IT Consumer Digital Health
HealthEquity (HQY)
Teladoc (TDOC)
Benefitfocus (BNFT)
Quintiles IMS (Q-IMS)
Veeva (VEEV)
WebMD (WBMD)

DIGITAL HEALTH VALUATION COMPS
Sources: FactSet market data and consensus estimates as of close on 6/8/16. Fiscal years calendarized where applicable; EBITDA and EPS
are non-GAAP where available. NM - not meaningful; Enterprise Value based on a market cap that includes basic shares outstanding only.
4
Highlight = covered company
Street Street % EBIT
6/8/2016 Price CY16 EPS Eq. Val. 5-Yr Avg CY2 Rev CY2 EPS PEG Margin Short
Ticker Rat. Close Target vs. Street TAM ($m) (a) 16E 17E NTM P/E 16E 17E 16E 17E Growth Growth (c) 15A Int.
DIGITAL HEALTH BENEFITS
Benefitfocus BNFT - $39.71 - - - 1,160 NM NM NM NM NM 4.9 4.0 23% NM NM (23%) 6%
Castlight Health CSLT MP $4.77 $4.30 NM $1.7-5b 451 NM NM NM NM NM 3.3 2.6 27% NM NM (86%) 11%
HealthEquity HQY OP $29.12 $33.00 1.6% $7b 1,730 61.9 46.7 71.1 26.9 21.0 9.3 7.4 25% 32% 1.9 21% 7%
Healthways HWAY - $12.59 - - - 455 52.9 32.5 36.7 8.2 7.3 0.9 0.8 6% NM NM 0% 5%
Teladoc TDOC OP $12.62 $21.00 NM $17b 489 NM NM NM NM NM 3.3 2.3 45% NM NM (72%) 9%
WageWorks WAGE OP $59.23 $59.00 2.6% $21b 2,164 41.9 35.5 42.1 15.2 13.0 4.6 4.2 11% 18% 2.3 23% 4%
Median - - - - - - - 52.9 35.5 42.1 15.2 13.0 4.0 3.3 24% 25% 2.1 (11%) 7%
DIGITAL PHARMA SERVICES
Everyday Health EVDY OP $7.46 $13.00 (14.7%) - $245 15.5 8.3 15.4 7.3x 5.3 1.3x 1.1x 13% 88% 0.2 (2%) 1%
IMS Health IMS OP $25.81 $31.00 0.2% $75b 8,662 16.2 14.6 18.7 13.4 12.4 4.0 3.8 6% 11% 1.5 12% 1%
Medidata Solutions MDSO MP $47.56 $47.00 (0.8%) $10-12b 2,681 47.2 38.7 41.5 24.4 19.6 5.7 4.7 19% 22% 2.1 7% 10%
Model N MODN - $13.75 - - - 375 NM NM NM NM NM 2.7 2.2 22% NM NM (10%) 3%
Quintiles Q - $66.80 - - - 8,112 17.7 16.0 19.8 10.9 10.1 2.1 2.0 7% NM NM 16% 5%
Veeva Systems VEEV MP $35.14 $32.00 (0.2%) $5b 5,120 62.1 49.0 72.7 33.3 25.6 9.1 7.5 21% 27% 2.3 27% 10%
WebMD WBMD OP $64.53 $70.00 2.8% - 3,377 34.5 30.0 35.0 15.2 13.3 4.9 4.5 9% 15% 2.3 20% 15%
Median - - - - - - - 26.1 23.0 27.4 14.3 12.8 4.0 3.8 13% 22% 2.1 12% 5%
NEXT-GEN HEALTHCARE IT
Advisory Board Company ABCO - $35.17 - - - 2,075 20.6 18.5 34.4 13.5 12.3 3.1 2.9 8% NM NM (6%) 6%
Evolent Health EVH OP $16.46 - - - 971 NM NM NM NM NM 4.9 3.8 28% NM NM (25%) 5%
HealthStream HSTM - $26.58 - - - 850 92.0 63.1 72.3 18.5 15.3 3.0 2.7 11% 46% 2.0 10% 2%
Imprivata IMPR OP $13.38 $17.00 NM $3b 336 NM NM NM NM NM 2.1 1.8 16% NM NM (16%) 5%
Inovalon INOV - $18.41 - - - 2,805 33.6 26.3 34.9 13.6 11.1 4.5 3.9 16% 28% 1.2 28% 10%
Nuance Communications NUAN OP $17.48 $22.00 (0.5%) - 5,209 11.2 10.3 13.1 10.2 10.1 3.5 3.4 3% 8% 1.4 27% 5%
Omnicell OMCL - $34.15 - - - 1,221 21.9 18.8 20.4 12.8 11.1 2.0 1.8 8% 16% 1.3 10% 4%
Philips PHG - $26.88 - - - 24,856 16.0 13.5 13.8 7.8 7.0 1.0 1.0 3% NM NM 9% 0%
Press Ganey PGND MP $36.66 $33.00 0.1% $3b 1,953 33.4 29.9 29.6 15.1 13.6 5.7 5.3 9% 12% 2.9 (5%) 2%
Vocera VCRA OP $12.53 - - - 331 NM NM NM NM 36.7 1.8 1.7 9% NM NM (16%) 6%
Median - - - - - - - 27.6 22.6 25.0 13.2 11.1 3.0 2.7 9% 16% 1.4 9% 5%
CONSUMER HEALTH
Care.com CRCM - $9.15 - - - 307 58.8 31.6 44.7 24.0 15.2 1.6 1.4 13% NM NM (22%) 4%
Everyday Health EVDY OP $7.46 $13.00 (14.7%) - 245 15.5 8.3 15.4 7.3 5.3 1.3 1.1 13% 88% 0.2 (2%) 1%
Fitbit FIT MP $14.10 $18.00 (0.1%) - 3,428 12.0 10.0 NA 5.9 4.8 1.0 0.9 17% 20% 0.6 20% 23%
Mindbody MB - $13.65 - - - 538 NM NM NM NM NM 3.4 2.6 28% NM NM (26%) 9%
Philips PHG - $26.88 - - - 24,856 16.0 13.5 13.8 7.8 7.0 1.0 1.0 3% NM NM 9% 0%
Press Ganey PGND MP $36.66 $33.00 0.1% $3b 1,953 33.4 29.9 29.6 15.1 13.6 5.7 5.3 9% 12% 2.9 (5%) 2%
WebMD WBMD OP $64.53 $70.00 2.8% - 3,377 34.5 30.0 35.0 15.2 13.3 4.9 4.5 9% 15% 2.3 20% 15%
Weight Watchers WTW - $15.24 - - - 968 16.2 12.7 14.0 10.7 10.0 2.4 2.3 6% NM NM 16% 27%
Median - - - - - - - 16.2 13.5 22.5 10.7 10.0 2.0 1.8 11% 18% 1.4 4% 6%
S&P 500 SP50 - $2,046 - - - - 17.3 15.2 14.4 - - - - 6% 14% 1.3 15% -
S&P 600 HC SP568 - $1,628 - - - - 28.3 21.8 24.5 - - - - 9% 30% 0.9 9% -
NASDAQ Biotech 63109R10 $3,349 - - - - 27.7 22.7 24.9 - - - - 10% 22% 1.3 37% -
Median - - - - - - - 27.7 21.8 24.5 - - - - 9% 22% 1.3 15% -
P/E (b) EV / EBITDA EV / Revenue

5
Source: Company data and Leerink Partners estimates
DIGITAL HEALTH SECTOR
Online Health
Media
Consumer
Digital Tools
Consumer
Empowerment
Healthcare
Automation
Big Data
Analytics
Population
Health
Connected
Health Healthcare IT
• Definition
• Why it matters to Wall Street: Disruptive, Proprietary, and Durable
• Sectors of covered companies

Consumer Empowerment
LEERINK DIGITAL HEALTH LANDSCAPE
Healthcare Smart Systems and Workflow Automation
Connected Health
Big Data
Healthcare IT: EMR, RCM, HIE, Other
Digital Tools: Health Transparency Digital Tools: Benefits
Reimbursed
Online Media & Community
Payer
Physician
Community
Platform Analytics
Population Health Corporate / MCHealthcare System
PharmaProvider
Denotes public company Denotes acquired companyv1.8 Refer comments to: Steven.Wardell@Leerink.comSource: Leerink Partners

We identified 48 public pure-play stocks of the Digital Health sector and created the Leerink Digital
Health EW48 Index (LDH48).
7
DIGITAL HEALTH SECTOR REVENUE UP 25% IN 2016E, STOCKS UP 7%
Returns, past 12 months:
 S&P 500 Health Care: -2%
 NASDAQ Biotech: -23%
 LDH48 index: +7%
However, average revenue growth
across the LDH48 is projected to
be 25% in 2016 and 18% 2017
We believe Digital Health stocks are gaining favor in the biotech decline.
Note: A list of constituent companies is included in the Appendix of this document. The Leerink Digital Health EW48 Index is comprised of 48 pure-play Digital Health stocks with equal weighting. IPOs added
during the year are treated in the Digital Health Index through rebalancing (includes Fitbit, Inovalon, Press Ganey, Teladoc). Index is last twelve months as of 6/8/2016.
Source: Latest twelve month performance per FactSet 6/8/2016.

SUB-SECTOR LIFECYCLES
8
PM PROFILE: DIGITAL HEALTH
COVERED COMPANIES: 22% ’16E REV. GROWTH
• Average 22% 2016E top-line growth
• Wide valuation range: consensus EV/Sales (’16E) revenue
range 1.0x (FIT) to 9.2x (VEEV)
• Average 17% potential gain, 28% for OP rated names
• 4 of 13 IPO’d in last 12 months
THEMATIC VIEW: PERFECT STORM OF MEGATRENDS
(+) Demographics: consumers and physicians have shifted
their time online; we think advertisers will follow, creating a
boom for online health media companies.
(+) Employers are shifting healthcare costs onto employees,
creating opportunities for consumer digital tools companies
in healthcare; 2016 will be a big year for more cost shifting.
(+) Healthcare Reform has put IT at the center of how
healthcare gets done and paid for; hospitals are now
seeking to optimize their EMRs and workflows
CATALYSTS: Earnings, Cadillac Tax, MU3, CAHPS
• Earnings are report cards on usage and revenue growth
• Cadillac Tax effective Jan. 1, 2020, drives employer cost
shifting and healthcare consumerism in 2016-19
• Meaningful Use Stage 3 deadlines (ongoing) demand use of
HIT
• 2016 employee benefits season
• Growing CMS CAHPS requirements tie the patient experience
to payment
Source: FactSet data and Leerink Partners estimates

9
CASTLIGHT HEALTH, INC. (CSLT)
(CSLT – RATING: MARKET PERFORM; PRICE TARGET: $4.30)
INVESTMENT THESIS
• Castlight has built a leading health transparency information
platform that helps employers reduce health benefit costs.
• We believe that there will be strong healthcare cost-shifting by
employers onto employees in 2016 across the board.
• In our view, this shift will directly benefit Consumer Digital Tools
companies such as Castlight. These tools are often used by
employers with cost shifting.
COMPARATIVE STATS
• 2016E Sales growth: 33% (in line with consensus)
• Trading at trough levels, near 52-week low
Source: Company data, Leerink Partners estimates, FactSet Research Systems, and NBGH August 2014 survey
$-
$5.00
$10.00
$15.00
$20.00
$25.00
$30.00
Price Performance Since IPO
$4.77 Avg Daily Volume ('000s) 289
$10 Short Interest (% of float) 18.9%
$3 Float as % of Total 56.31%
$462
2015 2016E 2017E 2015 2016E 2017E
Leerink Partners $75 $100 $125 4.1x 3.1x 2.5x
Consensus $75 $101 $128 4.1x 3.1x 2.4x
$101 $128
2015 2016E 2017E 2015 2016E 2017E
Leerink Partners 252% 33% 25% ($65) ($42) ($12)
Consensus 252% 34% 27% ($65) ($39) ($13)
*Consensus estimates represent GAAP EBITDA.
2015 2016E 2017E
Leerink Partners ($0.68) ($0.41) ($0.11)
Consensus ($0.68) ($0.41) ($0.13)
($0.41) ($0.13)
Stock Performance: MTD YTD L12M L3Y
CSLT 13% 12% -49% N/a
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
Top 10 Holders ~ Shares Held % Out.
Fidelity Management & Research Co. 6,267,450 14.8%
M&G Investment Management Ltd. 3,212,979 7.6%
The Vanguard Group, Inc. 2,638,280 6.2%
Morgan Stanley Investment Management, Inc. 2,614,122 6.2%
Wellington Management Co. LLP 1,859,298 4.4%
Baillie Gifford & Co. 1,794,878 4.2%
Eventide Asset Management LLC 1,708,418 4.0%
BlackRock Fund Advisors 1,685,532 4.0%
Alyeska Investment Group LP 1,149,824 2.7%
Maverick Capital Ltd. 1,144,314 2.7%
EV/Sales
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Sales (mil)
Revenue Growth Adj. EBITDA*
Non-GAAP Diluted Pro-Forma EPS

10
Source: Leerink Partners LLC, company documents
Castlight Health, Inc. CSLT
Income Statement Model for FYE Dec. Mar-16 Jun-16 Sep-16 Dec-16
($MM except per share) 2013A 2014A 2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E 2016E 2017E
Revenue:
Subscription 11.7 41.6 70.4 21.0 21.2 23.6 27.1 93.0 116.2
Growth % q/q 5.5% 1.0% 11.0% 15.0%
Growth % y/y 243.3% 256.9% 69.1% 41.1% 23.0% 29.4% 36.1% 32.2% 25.0%
% of revenue 89.8% 91.2% 93.4% 92.6% 92.3% 92.7% 93.2% 92.7% 93.0%
Professional services 1.3 4.0 5.0 1.7 1.76 1.9 2.0 7.3 8.8
Growth % q/q 21.6% 5.0% 6.0% 6.0%
Growth % y/y 73.6% 203.7% 24.0% 60.8% 43.2% 43.2% 43.4% 46.9% 20.0%
% of revenue 10.2% 8.8% 6.6% 7.4% 7.7% 7.3% 6.8% 7.3% 7.0%
Total Revenue $13.0 $45.6 $75.3 $22.7 $23.0 $25.5 $29.1 $100.3 $125.0
Growth % q/q 7% 1% 11% 14%
Growth % y/y 212% 252% 65% 42% 24% 30% 37% 33% 25%
Adj. Cost of revenue:
Cost of subscription 6.2 10.3 11.9 3.8 3.8 4.1 4.6 16.3 19.8
Cost of professional services 10.9 16.1 19.2 4.6 4.7 4.7 4.6 18.5 18.0
Total cost of revenue 17.2 26.4 31.2 8.4 8.5 8.8 9.2 34.9 37.8
Growth % y/y 104% 54% 18% 26% 10% 11% 4% 12% 8%
Non-GAAP Gross Profit:
Subscription Gross Profit 5.4 31.3 58.4 17.3 17.4 19.5 22.5 76.6 96.5
% margin 46.5% 75.3% 83.0% 82.0% 82.0% 82.5% 83.0% 82.4% 83.0%
Professional Services Gross Profit (9.6) (12.1) (14.3) (3.0) (2.9) (2.8) (2.6) (11.2) (9.3)
% margin (729.9%) (301.7%) (287.5%) (176.0%) (165.0%) (150.0%) (130.0%) (154.2%) (105.8%)
Total non-GAAP Gross profit (loss) ($4.2) $19.2 $44.1 $14.3 $14.5 $16.7 $19.9 $65.4 $87.2
Growth % y/y (1%) (557%) 129% 54% 34% 44% 60% 48% 33%
% gross margin (32.4%) 42.2% 58.6% 62.9% 63.1% 65.4% 68.5% 65.2% 69.8%
Adj. Operating expenses:
Sales and marketing 32.7 53.5 59.7 14.0 14.3 13.2 12.2 53.8 44.4
% of revenue 252.0% 117.3% 79.3% 61.8% 62.0% 52.0% 42.0% 53.6% 35.5%
y/y 11.6% (9.9%) (17.5%)
Research and development 14.6 20.7 28.8 8.7 8.7 8.4 8.4 34.3 36.9
% of revenue 112.7% 45.3% 38.3% 38.2% 38.0% 33.0% 29.0% 34.2% 29.5%
y/y 39.6% 18.8% 7.6%
General and administrative 8.3 14.7 20.1 4.5 4.6 4.8 5.2 19.2 18.1
% of revenue 63.7% 32.2% 26.7% 20.0% 20.0% 19.0% 18.0% 19.2% 14.5%
y/y 36.8% (4.4%) (5.7%)
Total operating expenses 55.6 88.8 108.6 27.3 27.6 26.5 25.9 107.3 99.4
y/y 60% 22% (1.3%) (7.3%)
Non-GAAP Operating Income (loss) (59.8) (69.6) (64.5) (13.0) (13.1) (9.8) (6.0) (41.9) (12.2)
D&A 0.6 1.4 2.0 0.8 0.8 0.8 0.8 3.1 3.1
Adj. EBITDA (59.1) (68.3) (62.5) (12.188) (12.3) (9.0) (5.2) (38.7) (9.0)
Growth % y/y 76.1% 15.4% (8.5%) (22.3%) (28.0%) (41.6%) (63.5%) (38.0%) (76.7%)
% EBITDA margin (455.9%) (149.7%) (83.0%) (53.7%) (53.5%) (35.5%) (17.8%) (38.6%) (7.2%)
Other income, net 0.2 0.2 0.3 0.1 0.1 0.1 0.1 0.2 0.2
Pre-tax income (EBT) (59.6) (69.4) (64.2) (12.9) (13.1) (9.8) (5.9) (41.6) (12.0)
Income tax (benefit) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tax rate 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Net Income (loss) Non-GAAP (59.6) (69.4) (64.2) (12.9) (13.1) (9.8) (5.9) (41.6) (12.0)
Non-GAAP EPS - diluted pro-forma ($0.80) ($0.93) ($0.68) ($0.13) ($0.13) ($0.10) ($0.06) ($0.41) ($0.11)
Non-GAAP EPS - Diluted ($6.03) NM NM NM NM NM NM NM NM
Adjustments (2.6) (16.5) (16.2) (8.5) (5.7) (5.7) (5.7) (25.7) (25.0)
GAAP Net Income (62.2) (85.9) (80.4) (21.4) (18.8) (15.5) (11.7) (67.3) (36.9)
GAAP EPS - diluted ($6.28) ($1.16) ($0.86) ($0.22) ($0.18) ($0.15) ($0.11) ($0.67) ($0.35)
Pro-forma GAAP EPS ($0.84)
Basic WASO 9.9 74.4 93.7 96.3 101.8 102.8 103.8 101.1 106.3
Diluted WASO 9.9 74.4 93.7 96.3 101.8 102.8 103.8 101.1 106.3
Pro-forma Diluted shares 74.4 NM NM NM NM NM NM NM NM

11
Note: Diluted shares outstanding includes treatment of stock options using the treasury method.
Castlight Health, Inc. -2 -1 0 1 2 3 4 5 6 7 8 9
DCF Model Year -2 Year -1 Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9
($ MM) FY2013 2014 2015A 2016E 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E
Revenue $13.0 $45.6 $75.3 $100.3 $125.0 $150.0 $174.0 $196.6 $222.2 $248.8 $273.7 $301.1
% change - 251.5% 65.1% 33.2% 24.6% 20.0% 16.0% 13.0% 13.0% 12.0% 10.0% 10.0%
Adj. EBIT (59.8) (69.6) (64.5) (41.9) (12.2) 7.5 17.4 29.5 40.0 49.8 54.7 60.2
% Margin (460.8%) (152.6%) (85.7%) (41.7%) (9.7%) 5.0% 10.0% 15.0% 18.0% 20.0% 20.0% 20.0%
% change 16% (7%) (35%) (71%) (162%) 132% 70% 36% 24% 10% 10%
Taxes @ 40% 0.0 0.0 0.0 0.0 0.0 3.0 7.0 11.8 16.0 19.9 21.9 24.1
Net Oper. Profit after Tax (59.8) (69.6) (64.5) (41.9) (12.2) 4.5 10.4 17.7 24.0 29.9 32.8 36.1
Deprec. & Amort. 0.6 1.4 2.0 3.1 3.3 3.5 3.7 4.0 4.2 4.6 4.9 5.3
% of revenue 4.9% 3.0% 2.7% 3.1% 2.6% 2.3% 2.1% 2.0% 1.9% 1.8% 1.8% 1.8%
CapX (2.6) (1.9) (5.4) (1.9) (1.9) (3.0) (3.5) (3.9) (4.4) (5.0) (5.5) (6.0)
% of revenue 19.9% 4.1% 7.1% 1.9% 1.5% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Change in WC 9.7 2.1 3.8 5.7 6.7 7.8 8.8 10.0 11.2 12.3 13.5
% of revenue 0.0% (21.3%) (2.8%) (3.8%) (4.6%) (4.5%) (4.5%) (4.5%) (4.5%) (4.5%) (4.5%) (4.5%)
Free cash flow (61.7) (60.4) (65.7) (36.8) (5.0) 11.7 18.5 26.6 33.8 40.7 44.6 49.0
Terminal value 573.7
Total value of cash flows (61.7) (60.4) (65.7) (36.8) (5.0) 11.7 18.5 26.6 33.8 40.7 44.6 622.7
Model Assumptions NPV at start of: 2016E 2017E
Terminal Growth Rate 4.0% DCF value of unl. FCF $257.3 $327.3
Future borrowing rate 5.0% DCF value of NOLs 20.5 23.2
Less: Net Debt (129.3) (117.7)
Discount Rate Components Equity Value 407.1 468.2
Risk Free Rate 1.9% Diluted SHOS 102.9 106.9
+ Beta 1.6 Implied value per share $3.96 $4.38
x Equity Risk Premium 7.2%
= Cost of Equity 13.4% Valuation Sensitivity ($/share)
+ After Tax Cost of Debt 3.0%
x Target Debt-to-Cap Ratio 5.0% $4.38 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5%
DISCOUNT RATE 12.9% 10.0% $5.45 $5.67 $5.93 $6.23 $6.59 $7.02 $7.54
Cash Tax Rate 40% 10.5% 5.13 5.32 5.54 5.79 6.08 6.43 6.84
CapX as % of sales 2.0% 11.0% 4.86 5.02 5.20 5.41 5.66 5.94 6.27
Depreciation Rate 15 11.5% 4.61 4.75 4.91 5.09 5.29 5.53 5.80
Change in net WC / sales (4.5%) 12.0% 4.39 4.51 4.65 4.80 4.98 5.17 5.40
12.5% 4.20 4.30 4.42 4.55 4.70 4.87 5.06
Diluted SHOS at Start of: 2016E 2017E 13.0% 4.02 4.11 4.22 4.33 4.46 4.60 4.76
Basic SHOS 101.8 105.8 13.5% 3.86 3.94 4.03 4.13 4.24 4.36 4.50
Stock options (treasury) 1.2 1.2 14.0% 3.71 3.79 3.86 3.95 4.05 4.16 4.27
Diluted SHOS 102.9 106.9 14.5% 3.58 3.64 3.71 3.79 3.88 3.97 4.07
15.0% 3.46 3.51 3.58 3.64 3.72 3.80 3.89
15.5% 3.34 3.40 3.45 3.51 3.58 3.65 3.73
16.0% 3.24 3.29 3.34 3.39 3.45 3.51 3.58
Growth Rate
DiscountRate

12
EVERYDAY HEALTH, INC. (EVDY)
(EVDY – RATING: OUTPERFORM; PRICE TARGET: $13)
INVESTMENT THESIS
• Everyday Health is a leading online health media company
providing health content to both consumers and physicians. Each
month it reaches approximately 53m people and 2/3 of all US
physicians.
• MEDACorp checks and market research indicate physicians and
consumers have moved strongly online
• We see the company poised to take advantage of three key Digital
Health growth drivers:
1. Pharma ad spend coming back strong after weakness in
past few years
2. Consumers taking charge of their healthcare
3. Consumers and physicians shifting content consumption
from offline to online sources
COMPARATIVE STATS
• 2016E Sales growth: 11% (inline with consensus)
Source: Company data, Leerink Partners estimates, and FactSet Research Systems
$-
$5.00
$10.00
$15.00
$20.00
$25.00
$248
2015 2016E 2017E 2015 2016E 2017E
Consensus $232 $257 $290 1.4x 1.3x 1.1x
$257 $290
2015 2016E 2017E 2015 2016E 2017E
Leerink Partners 18% 11% 13% $46 $46 $55
Consensus 18% 11% 13% $46 $45 $61
2015 2016E 2017E
Leerink Partners $0.79 $0.41 $0.68
Consensus $0.79 $0.48 $0.90
$0.48 $0.90
EVDY 11% 24% -41% N/a
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
BlackRock Fund Advisors 910,097 2.7%
Bow Street LLC 830,439 2.5%
Acuta Capital Partners LLC 824,464 2.5%
JPMorgan Investment Management, Inc. 717,258 2.2%
The Vanguard Group, Inc. 710,287 2.1%
Teachers Advisors, Inc. 649,216 2.0%
Westw ood Management Corp. (Texas) 601,089 1.8%
Putnam Investment Management LLC 591,132 1.8%
TFS Capital LLC 528,069 1.6%
52-Week High
Price on 06/08/16
52-Week Low
Market Cap (mil)
Sales (mil) EV/Sales
Revenue Growth Adj. EBITDA
Non-GAAP Diluted Pro-Forma EPS

13
Everyday Health, Inc. (EVDY)
Income Statement for FYE December, GAAP Mar-16 Jun-16 Sep-16 Dec-16
($MM) FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
Revenue:
Advertising and sponsorship revenues 134.9 166.5 209.1 51.3 55.2 55.6 81.6 243.8 280.3
Growth % y/y 22.7% 23.4% 25.6% 41.1% 10.0% 12.0% 12.0% 16.6% 15.0%
% of revenue 86.6% 90.3% 90.1% 92.9% 94.5% 94.8% 94.9% 94.4% 96.0%
Premium services revenues 21.0 17.9 22.9 3.9 3.2 3.0 4.4 14.6 11.6
Growth % y/y (11.0%) (14.8%) 28.2% (19.3%) (30.0%) (35.0%) (50.0%) (36.5%) (20.0%)
% of revenue 13.4% 9.7% 9.9% 7.1% 5.5% 5.2% 5.1% 5.6% 4.0%
Total Revenue $155.9 $184.3 $232.0 $55.2 $58.5 $58.6 $86.0 $258.3 $292.0
Growth % q/q (32.5%) 5.9% 0.3% 46.8%
Growth % y/y 12.5% 18.3% 25.9% 34.0% 6.7% 7.9% 5.3% 11.3% 13.0%
Cost of revenues 43.3 49.3 66.9 19.1 15.8 17.0 22.4 74.2 79.0
% of revenue 27.8% 26.7% 28.8% 34.6% 27.0% 29.0% 26.0% 28.7% 27.0%
Gross Profit - GAAP 112.5 135.0 165.1 36.1 42.7 41.6 63.7 184.1 213.0
Growth % y/y 14.9% 20.0% 22.2% 33.3% 4.4% 7.6% 9.0% 11.5% 15.7%
% margin 72.2% 73.3% 71.2% 65.4% 73.0% 71.0% 74.0% 71.3% 73.0%
Sales and marketing 44.4 51.0 74.8 21.1 23.7 20.5 21.5 86.8 89.6
% of revenue 28.5% 27.7% 32.2% 38.2% 40.5% 35.0% 25.0% 33.6% 30.7%
y/y 14.9% 46.6% 16.1% 3.3%
Product development 44.5 42.3 55.9 16.2 14.6 14.1 17.2 62.1 66.0
% of revenue 28.6% 23.0% 24.1% 29.3% 25.0% 24.0% 20.0% 24.0% 22.6%
y/y (4.9%) 32.1% 11.0% 6.3%
% of revenue 17.1% 16.2% 17.0% 22.9% 22.0% 20.0% 14.0% 19.1% 17.2%
y/y 11.7% 32.3% 24.8% 2.0%
Operating Income - GAAP ($3.1) $11.8 ($5.1) ($13.8) ($8.5) ($4.7) $12.9 ($14.0) $7.1
% margin (2.0%) 6.4% (2.2%) (25.0%) (14.5%) (8.0%) 15.0% (5.4%) 2.4%
Other Income (expense), net (0.4) (4.1) 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Interest expense, net (8.4) (3.7) (5.2) (1.7) (1.7) (1.7) (1.7) (6.8) (4.0)
GAAP Pre-tax Income (Loss) (11.9) 4.0 (10.3) (15.5) (10.2) (6.4) 11.2 (20.8) 3.1
Benefit (provision) for Income taxes (1.1) 8.7 (1.3) (0.6) (0.6) (0.6) (1.0) (2.9) (4.0)
Tax rate % 9.3% 215.7% 12.6% 4.0% 6.1% 9.7% (8.9%) 13.7%
Income (loss) from cont ops., net of tax (13.0) 12.7 (11.6) (16.1) (10.8) (7.0) 10.2 (23.7) (0.9)
Loss from discont. op., net of tax (5.2) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
GAAP Net Income (loss) ($18.2) $12.7 ($11.6) ($16.1) ($10.8) ($7.0) $10.2 ($23.7) ($0.9)
Series G preferred stock deemed dividend 0.0 (8.1) 0.0 0.0 0.0 0.0 0.0 0.0 0.0
GAAP net income (loss) attr. to common (18.2) 4.6 (11.6) (16.1) (10.8) (7.0) 10.2 (23.7) (0.9)
Non-GAAP Net Income ($7.8) $16.0 $26.5 ($5.7) ($1.8) $2.0 $19.2 $13.7 $23.1
Non-GAAP EPS Diluted (pro-forma) ($0.33) $0.59 $0.79 ($0.17) ($0.05) $0.06 $0.57 $0.41 $0.68
Growth % y/y NA NA 33.6% NA (120.0%) (12.8%) (3.9%) (48.0%) 63.7%
Diluted Pro-Forma WASO 23.7 26.9 33.3 32.8 32.8 33.3 33.8 33.2 34.2
y/y 14% 24% (0%) 3%

14
EVDY Fair Value In 12 Months 2017E
Forward EV/Adj. EBITDA multiple 10.0x
Adj. EBITDA $55.1
Enterprise Value $551
Less debt 1Q17E $123
Plus cash 1Q17E $41
Equity value $469
Dil. shares outstanding 1Q17E 33.8
Price Target $13.87
upside 164.5%
EVDY Fair Value In 12 Months 2017E
Forward P/E multiple 18.0x
Adj. EPS $0.68
Price Target $12.16
upside 131.8%
Average Price Target (12 mo.) $13.02
upside 148.1%

15
FITBIT, INC. (FIT)
(FIT – RATING: MARKET PERFORM; PRICE TARGET: $18)
INVESTMENT THESIS
• Riding multiple US and global megatrends: (1) social trend toward
greater health and fitness behaviors among consumers, (2) economic
trend with consumers increasingly willing to take charge of their
healthcare and willing to pay out-of-pocket dollars for products that
help them manage their health, (3) corporate wellness programs
adopting activity trackers
• Revenue upside potential in Corporate Wellness channel (<10% of
sales today)
• Valuation upside potential in social network
COMPARATIVE STATS
• 2016E Sales growth: 39% (vs. consensus 38%)
• IPO in June 2015 at $20
$14.10 Avg Daily Volume ('000s) 9,109
$3,815
2015 2016E 2017E 2015 2016E 2017E
Leerink Partners $1,858 $2,588 $2,989 1.7x 1.2x 1.0x
Consensus $1,858 $2,572 $3,020 1.7x 1.2x 1.0x
$2,572 $3,020
2015 2016E 2017E 2015 2016E 2017E
Consensus 13% 38% 17% $390 $446 $543
2015 2016E 2017E
Consensus $1.08 $0.91 $1.12
FIT -1% NA NA NA
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
BlackRock Advisors LLC 4,483,410 1.8%
Shannon River Fund Management LLC 3,999,607 1.6%
Bloom Tree Partners LLC 3,183,981 1.3%
Morgan Stanley Smith Barney LLC 2,608,990 1.0%
12 West Capital Management LP 2,396,218 0.9%
Coatue Management LLC 2,203,710 0.9%
BlackRock Investment Management (UK) Ltd. 2,142,918 0.8%
52-Week Low
Market Cap (mil)
GAAP Diluted EPS, Cont. Ops
Price on 06/08/16
52-Week High
$10.00
$15.00
$20.00
$25.00
$30.00
$35.00
$40.00
$45.00
$50.00
$55.00

16
Fitbit, Inc. (FIT)
Income Statement for FYE Dec. 31, GAAP Mar-16 Jun-16 Sep-16 Dec-16
$ in Thousands FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
Revenue:
Total revenue 271,087 745,433 1,857,998 505,356 579,600 492,660 1,009,953 2,587,569 2,988,714
Growth % y/y 175.0% 149.3% 50.1% 44.8% 20.4% 41.9% 39.3% 15.5%
Cost of revenue: 210,836 387,776 956,935 271,601 303,710 250,764 512,046 1,338,122 1,531,191
% of revenue 77.8% 52.0% 51.5% 53.7% 52.4% 50.9% 50.7% 51.7% 51.2%
Gross profit 60,251 357,657 901,063 233,755 275,890 241,896 497,907 1,249,447 1,457,522
% margin 22.2% 48.0% 48.5% 46.3% 47.6% 49.1% 49.3% 48.3% 48.8%
Operating expenses:
Research and development 27,873 54,167 150,035 72,248 95,634 100,995 104,025 372,902 462,205
% of revenue 10.3% 7.3% 8.1% 14.3% 16.5% 20.5% 10.3% 14.4% 15.5%
y/y 72% 94% 177% 149% 24%
Sales and marketing 26,847 112,005 332,741 107,051 130,410 66,509 108,065 412,035 453,241
% of revenue 9.9% 15.0% 17.9% 21.2% 22.5% 13.5% 10.7% 15.9% 15.2%
y/y 162% 317% 197% 24% 10%
General and administrative 14,485 33,556 77,793 35,702 36,515 37,442 39,388 149,047 166,764
% of revenue 5.3% 4.5% 4.2% 7.1% 6.3% 7.6% 3.9% 5.8% 5.6%
y/y 265% 132% 132% 92% 12%
Change in contingent consideration (7,704) - -
Total operating expenses 69,205 199,728 552,865 215,001 262,559 204,947 251,478 933,985 1,082,210
43%
Income from operations (8,954) 157,929 348,198 18,754 13,331 36,950 246,429 315,463 375,312
% margin -3.3% 21.2% 18.7% 3.7% 2.3% 7.5% 24.4% 12.2% 12.6%
y/y 120.5% -9.4% 19.0%
Total other income (expense) (4,731) (18,156) (60,249) 2,150 200 200 200 2,750 800
Pre-tax Income (loss) (13,685) 139,773 287,949 20,904 13,531 37,150 246,629 318,213 376,112
Income tax expense (benefit) 37,937 7,996 112,272 9,869 4,059 11,145 73,989 99,062 112,834
Tax rate (277.2%) 5.7% 39.0% 47.2% 30.0% 30.0% 30.0% 31.1% 30.0%
GAAP net income (loss) (51,622) 131,777 175,677 11,035 9,472 26,005 172,640 219,151 263,279
% margin (19.0%) 17.7% 9.5% 2.2% 1.6% 5.3% 17.1% 8.5% 8.8%
Diluted EPS - GAAP ($1.32) $0.63 $0.75 $0.05 $0.04 $0.10 $0.68 $0.88 $1.00
Diluted EPS - Adjusted - 0.56 1.08 0.10 0.10 0.18 0.77 1.17 1.28
Diluted shares (non-GAAP, pro forma) 39,179 202,608 236,341 242,009 247,091 250,798 254,560 248,614 264,250
Net income and comprehensive income reconciliation to Adjusted EBITDAFY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
GAAP net income (51,622) 131,777 175,677 11,035 9,472 26,005 172,640 219,151 263,279
Impact of Fitbit Force recall 84,650 22,840 (10,171) 11 - - - 11 -
Stock-based compensation expense 620 6,804 41,024 17,770 22,000 28,000 32,000 99,770 106,000
Revaluation of redeemable convertible preferred stock warrant liability3,370 13,272 56,655 - - - - - -
Depreciation and amortization 3,012 6,131 21,107 7,008 8,008 9,008 10,008 34,032 40,032
Change in contingent consideration - - (7,704) - - - - - -
Interest expense, net 1,082 2,222 1,019 (582) (200) (200) (200) (1,182) (800)
Income tax expense (benefit) 37,937 7,996 112,272 9,869 4,059 11,145 73,989 99,062 112,834
Total adjustments 130,671 59,265 214,202 34,076 33,867 47,953 115,797 231,693 258,066
Adjusted EBITDA 79,049 191,042 389,879 45,111 43,339 73,958 288,437 450,844 521,344
Margin % 29.2% 25.6% 21.0% 8.9% 17.4% 17.4%
y/y NM 141.7% 104.1% 15.6% 15.6%
Source: Company reports, Leerink Partners LLC estimates

17
Fitbit, Inc. (FIT)
Revenue Build Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
Units in thousands FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E 1Q:17E 2Q:17E 3Q:17E 4Q:17E FY2017E
Total Devices sold (000) 4,476 10,904 21,324 4,800 5,520 4,692 9,619 24,631 5,964 6,560 5,904 10,037 28,464
q/q -41.5% 15.0% -15.0% 105.0% -38.0% 10.0% -10.0% 70.0%
y/y 250.0% 143.6% 95.6% 24.2% 23.8% -2.3% 17.3% 15.5% 24.2% 18.8% 25.8% 4.3% 15.6%
ASP $60.56 $68.36 $87.13 $105.28 $105.00 $105.00 $105.00 $105.06 $105.00 $105.00 $105.00 $105.00 $105.00
q/q 21.3%
y/y 1.4% 12.9% 27.5% 20.9% 20.6% -0.1%
Active users 2,570 6,700 16,900
Growth % y/y 360.6% 160.7% 152.2%
Total revenue (000) 271,087 745,433 1,857,998 505,356 579,600 492,660 1,009,953 2,587,569 626,171 688,788 619,909 1,053,846 2,988,714
q/q -29% 15% -15% 105% -38% 10% -10% 70%
y/y 255.0% 175% 149% 50% 45% 20% 42% 39% 24% 19% 26% 4% 16%
% of full year 100% 20% 22% 19% 39% 100% 21% 23% 21% 35% 100%
Revenue per user $105.48 $111.26 $109.94
Other Data:
Geographic Sales FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E 1Q:17E 2Q:17E 3Q:17E 4Q:17E FY2017E
US 562,553 1,381,152 351,685
% of total 75% 74% 70%
y/y 146% 33%
Americas ex US 38,576 92,252 23,394
% of total 5% 5% 5%
y/y 139% 74%
EMEA 60,699 208,767 74,724
% of total 8% 11% 15%
y/y 244% 113%
APAC 83,605 175,827 55,553
% of total 11% 9% 11%
y/y 110% 142%
Total 745,433 1,857,998 505,356
Market share ($, NPD Group):
connected activity trackers 59% 70%
GPS fitness watches 0% 3%
Registered Users on Platform 4,500 14,600 29,000
% active 57% 46% 58%
Fortune 500 Corporate Wellness clients over 50
"Works With Fitbit" partners ~35

18
HEALTHEQUITY, INC. (HQY)
(HQY – RATING: OUTPERFORM; PRICE TARGET: $33)
INVESTMENT THESIS
• Poised to benefit from a number of key Digital Health growth drivers:
(1) employers shifting healthcare benefit expenses onto employees,
especially in the lead-up to the Cadillac Tax, which goes into effect in
2018; (2) the concurrent rise in employer provisioning of Consumer
Directed Benefit (CDB) accounts such as Health Saving Accounts
(HSAs); and (3) the resulting rise in consumer use of these tax-
advantaged accounts in response to both employer cost-shifting and
growing consumerism in healthcare.
• HQY’s broad network of existing partners as a company-specific
asset, giving it access to ~30% (company estimate) of the under-65
privately insured population in the US.
COMPARATIVE STATS
• CY16/FY17E Sales growth: 40% (vs. Street 39%)
$1,687
2014A 2015A 2016E 2014A 2015A 2016E
Consensus $88 $127 $176 17.2x 11.9x 8.6x
$127 $176
2014A 2015A 2016E 2014A 2015A 2016E
Leerink Partners 35% 44% 40% $25.5 $40.6 $58.2
Consensus 35% 44% 39% $25.5 $40.6 $59.4
2014A 2015A 2016E
Consensus $0.21 #N/A $0.48
HQY 13% 16% 7% NA
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
W.R. Berkley Corp. (Investment Portfolio) 11,969,699 20.7%
Wells Capital Management, Inc. 3,326,622 5.7%
Janus Capital Management LLC 2,622,011 4.5%
Wasatch Advisors, Inc. 2,121,366 3.7%
BAMCO, Inc. 1,659,545 2.9%
Stephens Investment Management Group LLC 1,413,279 2.4%
Invesco Advisers, Inc. 1,405,746 2.4%
Next Century Grow th Investors LLC 1,397,633 2.4%
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Diluted Pro-Forma EPS
$10.00
$15.00
$20.00
$25.00
$30.00
$35.00
$40.00

19
HealthEquity, Inc. (HQY)
Income Statement for FYE Jan. 31, GAAP Apr-16 Jul-16 Oct-16 Jan-17
Revenue:
Total revenue 62,015 87,855 126,786 44,013 43,751 42,985 46,714 177,463 215,023
Growth % y/y 34.6% 41.7% 44.3% 47.4% 43.5% 40.7% 30.2% 40.0% 21.2%
Cost of services:
Account costs 21,473 29,760 39,155 11,207 11,015 12,233 16,105 50,560 56,289
Custodial costs 3,487 4,141 6,522 2,356 2,537 2,593 3,175 10,660 13,789
Card costs 4,137 5,899 8,248 2,719 2,990 2,749 2,853 11,310 12,924
Other costs 116 82 263 50.0 49.7 48.8 53.1 202 246
Total cost of services 29,213 39,882 54,188 16,332 16,592 17,624 22,185 72,733 83,248
% of revenue 47.1% 45.4% 42.7% 37.1% 37.9% 41.0% 47.5% 41.0% 38.7%
Gross profit 32,802 47,973 72,598 27,681 27,159 25,361 24,529 104,730 131,775
% margin 52.9% 54.6% 57.3% 62.9% 62.1% 59.0% 52.5% 59.0% 61.3%
Operating expenses:
Sales and marketing 8,602 10,619 13,302 4,183 4,375 4,298 5,839 18,696 21,502
% of revenue 13.9% 12.1% 10.5% 9.5% 10.0% 10.0% 12.5% 10.5% 10.0%
Technology and development 7,142 10,501 16,832 4,625 5,688 6,147 6,306 22,766 26,912
% of revenue 11.5% 12.0% 13.3% 10.5% 13.0% 14.3% 13.5% 12.8% 12.5%
% of revenue 6.3% 9.5% 11.1% 10.4% 12.0% 11.0% 11.0% 11.1% 10.8%
Amortization of acquired intangible assets 1,637 1,637 2,208 1,049 1,049 1,049 1,049 4,196 4,196
% of revenue 2.6% 1.9% 1.7% 2.4% 2.4% 2.4% 2.2% 2.4% 2.0%
Total operating expenses 21,278 31,100 46,455 14,431 16,362 16,223 18,333 65,349 75,833
y/y 25% 46% 49% 41% 16%
Income from operations 11,524 16,873 26,143 13,250 10,797 9,139 6,196 39,382 55,943
% margin 18.6% 19.2% 20.6% 30.1% 24.7% 21.3% 13.3% 22.2% 26.0%
62.5% 46.4% 54.9%
Total other income (expense) (6,150) (1,109) (589) (641) (168) (168) (168) (1,145) (672)
Pre-tax Income (loss) 5,374 15,764 25,554 12,609 10,629 8,971 6,028 38,237 55,271
Income tax provision 4,141 5,598 8,941 4,536 3,824 3,227 2,168 13,755 19,883
Tax rate 77.1% 35.5% 35.0% 36.0% 36.0% 36.0% 36.0% 36.0% 36.0%
GAAP net income and comprehensive income 1,233 10,166 16,613 8,073 6,806 5,743 3,859 24,481 35,387
% margin 2.0% 11.6% 13.1% 18.3% 15.6% 13.4% 8.3% 13.8% 16.5%
GAAP net income per share attributable to common stockholders:
Basic ($1.26) $0.31 $0.29 $0.14 $0.12 $0.10 $0.06 $0.42 $0.58
Diluted ($1.26) $0.20 $0.28 $0.14 $0.11 $0.09 $0.06 $0.40 $0.56
% growth Na 40.0% 57.8% 50.5% 36.8% 19.2% 43.3% 38.7%
GAAP weighted-average number of shares used in computing net income per share attributable to common stockholders:
Basic 5,651 31,181 56,719 57,820 58,687 59,274 59,867 58,912 61,379
Diluted 5,651 51,856 58,863 59,399 60,290 60,893 61,502 60,521 63,055
Net income per share reconciliation to pro forma non-GAAP EPSFY2014A FY2015A FY2016A 1Q:17A 2Q:17E 3Q:17E 4Q:17E FY2017E FY2018E
GAAP net income 10,166 16,613 8,073 6,806 5,743 3,859 24,481 35,387
Non-cash charge from performance-based stock options 1,565 3,647 1,130 1,409 1,409 1,409 5,356 5,634
Pro forma non-GAAP net income 11,238 20,260 9,203 8,214 7,152 5,268 29,837 41,022
Pro forma weighted average shares used in computing non-GAAP diluted earnings per share (1)51,856 58,863 59,399 60,290 60,893 61,502 60,521 63,055
Pro forma non-GAAP earnings per diluted share 0.22$ 0.34$ 0.15$ 0.14$ 0.12$ 0.09$ 0.49$ 0.65$
y/y 58.8% 43.2% 32.0%

20
HealthEquity, Inc. (HQY)
Revenue Build for FYE Jan. 31, GAAP Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18
Units in thousands, except members FY2014A FY2015A FY2016A 1Q:17A 2Q:17E 3Q:17E 4Q:17E FY2017E 1Q:18E 2Q:18E 3Q:18E 4Q:18E FY2018E
Revenue:
Account fee revenue 30,575 45,010 61,035 18,882 18,770 18,897 19,798 76,347 21,131 20,924 20,984 21,984 85,022
Revenue per member 10.57$ 41.35$ 38.23$ 8.54$ 8.35$ 8.25$ 8.05$ 33.19$ 7.77$ 7.60$ 7.51$ 7.33$ 30.20$
y/y fee change NM (7.5%) (13.5%) (13.6%) (13.3%) (12.3%) (13.2%) (9.0%) (9.0%) (9.0%) (9.0%) (9.0%)
% of total revenue 49.3% 51.2% 48.1% 42.9% 42.9% 44.0% 42.4% 43.0% 40.5% 39.6% 39.4% 38.7% 39.5%
Growth % y/y 38.3% 47.2% 35.6% 31.2% 28.5% 25.6% 16.5% 25.1% 11.9% 11.5% 11.0% 11.0% 11.4%
Custodial fee revenue 18,955 24,374 37,755 13,811 14,641 14,817 16,468 59,737 18,390 19,101 19,275 20,846 77,612
% of avg. daily cash AUM fee 1.71% 1.63% 1.71% 0.39% 0.40% 0.40% 0.42% 1.65% 0.40% 0.41% 0.41% 0.42% 1.64%
% of total revenue 30.6% 27.7% 29.8% 31.4% 33.5% 34.5% 35.3% 33.7% 35.3% 36.2% 36.2% 36.7% 36.1%
Growth % y/y 24.9% 28.6% 54.9% 64.0% 62.1% 62.1% 47.5% 58.2% 33.2% 30.5% 30.1% 26.6% 29.9%
Card fee revenue 11,931 17,746 27,423 11,208 10,228 9,162 10,329 40,927 12,512 12,667 12,857 13,805 51,841
% of total revenue 19.2% 20.2% 21.6% 25.5% 23.4% 21.3% 22.1% 23.1% 24.0% 24.0% 24.1% 24.3% 24.1%
Growth % y/y 40.0% 48.7% 54.5% 64.4% 51.1% 47.5% 35.5% 49.2% 11.6% 23.8% 40.3% 33.6% 26.7%
Other revenue 554 725 573 112 111 109 119 452 133 134 136 144 547
% of total revenue 0.9% 0.8% 0.5% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3%
Growth % y/y 94.4% 30.9% -21.0% -48.4% 26.5% -31.2% 9.1% -21.2% 18.5% 20.7% 23.9% 21.5% 21.2%
Total revenue 62,015 87,855 126,786 44,013 43,751 42,985 46,714 177,463 52,165 52,826 53,252 56,780 215,023
Growth % y/y 41.7% 44.3% 47.4% 43.5% 40.7% 30.2% 40.0% 18.5% 20.7% 23.9% 21.5% 21.2%
HSA Members:
HSA Members 2,228,041 2,267,821 2,313,178 2,660,155 2,739,959 2,767,359 2,822,706 3,246,112
Growth % q/q 4.1% 1.0% 2.0% 15.0% 3.0% 1.0% 2.0% 15.0%
Growth % y/y 51.1% 47.5% 44.4% 24.3% 23.0% 22.0% 22.0% 22.0%
Average HSA Members (YTD) 2,211,860 2,212,164 2,269,680 2,367,299 2,571,097 2,722,491 2,776,675 2,894,034
Growth % y/y 51.5% 49.0% 49.6% 47.9% 16.2% 23.1% 22.3% 22.3%
Growth % q/q 38.2% 0.0% 2.6% 4.3% 8.6% 5.9% 2.0% 4.2%
Average HSA Members (QTD) 2,211,860 2,247,931 2,290,500 2,459,359 2,720,060 2,753,659 2,795,032 3,001,087
% discount factor 99.3% 100.0% 100.0% 98.9% 99.3% 100.0% 100.0% 98.9%
Growth % y/y 51.5% 48.8% 44.9% 32.9% 23.0% 22.5% 22.0% 22.0%
Growth % q/q 19.5% 1.6% 1.9% 7.4% 10.6% 1.2% 1.5% 7.4%
HSA Members with investments 49,761
Growth % y/y 39.4%
Assets under management
Cash AUM 3,597,111 3,700,553 3,756,062 4,507,274 4,687,565 4,781,316 4,829,129 5,794,955
Growth % q/q 9.7% 2.0% 1.5% 20.0% 4.0% 2.0% 1.0% 20.0%
Growth % y/y 63.6% 63.7% 62.7% 37.5% 30.3% 29.2% 28.6% 28.6%
% of total AUM 88.0% 86.0% 85.7% 89.0% 87.0% 86.0% 85.5% 89.0%
Investment AUM 488,343 602,416 626,741 557,079 700,441 778,354 818,975 716,230
Growth % y/y 41.2% 61.9% 62.7% 37.3% 43.4% 29.2% 30.7% 28.6%
% of total AUM 12.0% 14.0% 14.3% 11.0% 13.0% 14.0% 14.5% 11.0%
Total AUM 4,085,454 4,302,969 4,382,802 5,064,353 5,388,005 5,559,670 5,648,104 6,511,185
Growth % y/y 60.6% 63.5% 62.7% 37.4% 31.9% 29.2% 28.9% 28.6%
Average daily cash AUM (YTD) 1,107,308 1,499,764 2,212,713 3,518,081 3,525,431 3,583,088 3,890,250 3,629,213 4,597,419 4,658,718 4,701,321 5,023,241 4,745,175
Growth % y/y 64.4% 61.9% 62.3% 67.2% 30.7% 32.1% 31.2% 29.1%
Average daily cash AUM (QTD) 3,518,081 3,624,007 3,704,215 3,968,304 4,704,685 4,702,229 4,774,171 5,102,008
% discount factor 102.3% 99.3% 99.4% 96.0% 102.3% 99.3% 99.4% 96.0%
Growth % y/y 64.4% 63.7% 63.2% 47.9% 33.7% 29.8% 28.9% 28.6%
Cash AUM per HSA member 1,590.55$ 1,593.66$ 1,578.68$ 1,643.33$ 1,788.12$ 1,711.20$ 1,693.15$ 1,735.72$
Growth % y/y 8.5% 8.7% 8.5% 13.0% 12.4% 7.4% 7.3% 5.6%

21
IMPRIVATA, INC. (IMPR)
(IMPR – RATING: OUTPERFORM; PRICE TARGET: $17)
INVESTMENT THESIS
• Healthcare reform has put IT at the center of how healthcare is
provided and paid for, but traditional IT systems slow clinicians
down the more they need to use them.
• An enterprise single sign-on system (SSO), which speeds clinicians
back up, is increasingly becoming a software product that hospital
CIOs “need to have” on their network.
• This trend benefits Imprivata which has developed the leading SSO
in the hospital marketplace, growing rapidly over the past several
years, taking share from competitors and earning high rankings in
the SSO category from KLAS, a hospital IT rating firm.
• Security is a rising priority for hospital CIOs and Imprivata is well
positioned with its two new products, Patient Secure and Confirm ID,
which can boost topline growth.
COMPARATIVE STATS
• 2016E Sales growth: 17% (inline with consensus)
• Trading near 52-week low
$8.00
$10.00
$12.00
$14.00
$16.00
$18.00
$20.00
$22.00
$24.00
$339
2015 2016E 2017E 2015 2016E 2017E
Consensus $119 $139 $162 2.5x 2.1x 1.8x
$139 $162
2015 2016E 2017E 2015 2016E 2017E
Consensus 36% 17% 16% ($12) ($9) ($1)
2015 2016E 2017E
Consensus ($0.69) ($0.52) ($0.20)
($0.52) ($0.20)
IMPR -2% 18% -12% N/a
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
Tamarack Advisers LP 1,709,893 6.8%
RGM Capital LLC 1,610,861 6.4%
Deerfield Management Company LP 983,486 3.9%
Paradigm Capital Management, Inc. 803,404 3.2%
Broadw ood Capital, Inc. 737,805 2.9%
Emerald Advisers, Inc. 630,414 2.5%
Emerald Mutual Fund Advisers Trust 597,994 2.4%
The Vanguard Group, Inc. 484,018 1.9%
BlackRock Fund Advisors 448,812 1.8%
-- #VALUE! --
Market Cap (mil)
Price on 06/08/16
52-Week High
52-Week Low
Non-GAAP Diluted EPS

22
Imprivata, Inc. (IMPR)
Income Statement for FY ending December Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
($MM) 2012A 2013A 2014A 2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E 2016E 1Q:17E 2Q:17E 3Q:17E 4Q:17E 2017E
Revenue:
Product 30.0 39.1 52.2 64.9 16.0 17.9 18.6 23.5 76.1 18.7 21.0 21.8 27.5 89.0
Growth % y/y 31% 30% 33% 24% 24% 10% 18% 18% 17% 17% 17% 17% 17% 17%
% of revenue 56% 55% 54% 55% 51% 53% 54% 59% 54% 51% 53% 55% 59% 55%
Maintenance and Service 24.0 32.0 44.8 54.2 15.5 15.8 15.6 16.6 63.6 18.0 18.4 18.1 19.3 73.8
Growth % y/y 30% 33% 40% 21% 22% 16% 16% 16% 17% 16% 16% 16% 16% 16%
% of revenue 44% 45% 46% 45% 49% 47% 46% 41% 46% 49% 47% 45% 41% 45%
Total Revenue 54.0 71.1 97.0 119.1 31.5 33.8 34.3 40.1 139.7 36.7 39.4 40.0 46.8 162.8
Growth % q/q -8% 7% 1% 17% -8% 7% 1% 17%
Growth % y/y NA 32% 36% 23% 23% 13% 17% 17% 17.3% 17% 17% 17% 17% 16.5%
Cost of Revenues:
Product COGS 6.9 7.8 12.3 16.9 4.7 5.1 4.9 6.0 20.7 5.2 5.2 5.5 6.6 22.5
Maintenance & Service COGS 6.6 11.0 17.7 21.2 5.3 5.5 5.5 5.8 22.1 6.2 6.3 6.3 6.6 25.5
Total cost of revenue 13.4 18.9 30.0 38.1 10.0 10.7 10.4 11.8 42.8 11.5 11.6 11.7 13.2 48.0
% of revenue 24.8% 26.5% 30.9% 31.9% 31.6% 31.5% 30.4% 29.4% 30.7% 31.2% 29.4% 29.3% 28.3% 29.5%
Gross Profit:
Product Gross Profit 23.1 31.3 39.9 48.1 11.3 12.8 13.7 17.5 55.3 13.5 15.7 16.4 20.9 66.5
% margin 77.1% 79.9% 76.4% 74.0% 70.6% 71.5% 73.5% 74.5% 72.7% 72.0% 75.0% 75.0% 76.0% 74.7%
y/y margin change (377) +279 (354) (239) (286) (343) +161 (78) (128) +137 +350 +150 +150 +194
Maintenance & Service 17.5 21.0 27.1 33.0 10.3 10.3 10.2 10.8 41.5 11.8 12.0 11.9 12.6 48.4
% margin 72.7% 65.5% 60.6% 60.9% 66.1% 65.0% 65.0% 65.0% 65.3% 65.5% 65.5% 65.5% 65.5% 65.5%
y/y margin change (324) (714) (500) +36 +482 +376 +548 +342 +436 (59) +50 +50 +50 +23
Total Gross Profit (GAAP) 40.6 52.2 67.0 81.1 21.6 23.1 23.9 28.3 96.9 25.3 27.8 28.2 33.5 114.8
% margin 75.2% 73.5% 69.1% 68.1% 68.4% 68.5% 69.6% 70.6% 69.3% 68.8% 70.6% 70.7% 71.7% 70.5%
y/y margin change (353) (170) (439) (103) +97 (24) +343 +101 +128 +41 +211 +106 +111 +118
Research and development 12.3 19.6 25.8 31.6 8.7 9.1 9.1 9.2 36.1 9.5 9.8 10.0 10.1 39.4
% of revenue 22.8% 27.6% 26.6% 26.5% 27.6% 27.0% 26.5% 23.0% 25.9% 26.0% 25.0% 25.0% 21.5% 24.2%
y/y 59.1% 31.5% 22.6% 14.3% 9.2%
Sales and marketing 22.5 30.5 45.0 52.4 14.2 14.9 14.1 14.4 57.6 14.3 15.2 15.2 16.1 60.8
% of revenue 41.6% 42.9% 46.4% 44.0% 45.1% 44.0% 41.0% 36.0% 41.2% 39.0% 38.5% 38.0% 34.5% 37.3%
y/y 35.9% 47.4% 16.4% 9.9% 5.6%
General and administrative 4.6 7.6 12.1 18.7 5.4 5.4 5.5 5.5 21.8 5.7 5.7 5.7 5.8 23.0
% of revenue 8.4% 10.7% 12.4% 15.7% 17.2% 16.0% 16.0% 13.6% 15.6% 15.5% 14.5% 14.3% 12.5% 14.1%
y/y 66.9% 58.2% 55.4% 16.3% 5.5%
Total operating expenses $39.4 $57.8 $82.8 $102.7 $28.3 $29.4 $28.6 $29.1 $115.5 $29.6 $30.7 $30.9 $32.0 $123.2
y/y 46.8% 43.4% 24.0% 12.4% 6.7%
EBIT (GAAP) 1.2 (5.5) (15.8) (21.7) (6.8) (6.3) (4.8) (0.8) (18.6) (4.3) (2.9) (2.6) 1.5 (8.4)
% margin 2.3% (7.8%) (16.3%) (18.2%) (21.5%) (18.5%) (13.9%) (2.0%) (13.3%) (11.7%) (7.4%) (6.6%) 3.2% (5.1%)
Adjusted EBITDA 2.3 (3.4) (11.5) (12.3) (4.5) (3.9) (2.4) 1.5 (9.3) (2.3) (0.9) (0.6) 3.5 (0.4)
Growth % y/y (44%) (243%) 243% 7% (0%) 76% (43%) (214%) (24%) (49%) (76%) (73%) 129% (96%)
% margin 4.3% (4.7%) (11.9%) (10.4%) (14.3%) (11.6%) (7.1%) 3.8% (6.7%) (6.2%) (2.4%) (1.6%) 7.5% (0.2%)
Other income (expense) (0.1) 0.1 (0.7) (0.6) 0.2 0.0 0.0 0.0 0.2 0.0 0.0 0.0 0.0 0.0
Income (loss) before taxes (GAAP) 1.2 (5.4) (16.6) (22.2) (6.5) (6.3) (4.8) (0.8) (18.4) (4.3) (2.9) (2.6) 1.5 (8.4)
Income taxes 0.1 0.1 0.2 0.8 0.1 0.0 0.0 0.0 0.1 0.0 0.0 0.0 0.1 0.1
Tax rate 9.4% (2.0%) (1.0%) (3.8%) (2.1%) 0.0% 0.0% 0.0% (0.8%) 0.0% 0.0% 0.0% 10.0% (1.8%)
Net Income (loss) (GAAP) $1.0 ($5.5) ($16.7) ($23.1) ($6.7) ($6.3) ($4.8) ($0.8) ($18.5) ($4.3) ($2.9) ($2.6) $1.3 ($8.5)
% margin 1.9% (7.8%) (17.3%) (19.4%) (21.2%) (18.5%) (13.9%) (2.0%) (13.3%) (11.7%) (7.4%) (6.6%) 2.9% (5.2%)
Accretion of redeemable convertible preferred stock (5.0) (5.0) (2.4) 0.0 - - - - 0.0 0.0 0.0 0.0 0.0 0.0
Net inc. (loss) attrib. to com. stockholders (3.9) (10.5) (19.2) (23.1) (6.7) (6.3) (4.8) (0.8) (18.5) (4.3) (2.9) (2.6) 1.3 (8.5)
GAAP EPS ($1.36) ($3.12) ($1.37) ($0.94) ($0.27) ($0.25) ($0.19) ($0.03) ($0.73) ($0.17) ($0.11) ($0.10) $0.05 ($0.33)
Non-GAAP Net Income (loss) NA NA (15.0) (16.8) (5.2) (4.7) (3.2) 0.8 (12.2) (3.1) (1.7) (1.4) 2.6 (3.6)
Non-GAAP EPS - Diluted NA NA ($1.08) ($0.69) ($0.21) ($0.19) ($0.12) $0.03 ($0.48) ($0.12) ($0.07) ($0.05) $0.09 ($0.14)
Basic shares 2.9 3.4 14.0 24.4 25.1 25.2 25.4 25.6 25.3 25.8 26.0 26.2 26.4 26.1
Diluted shares 2.9 3.4 14.0 24.4 25.1 25.2 25.4 25.6 25.3 25.8 26.0 26.2 27.8 26.1

23
Imprivata, Inc. (IMPR) -2 -1 0 1 2 3 4 5 6 7 8 9
DCF Model Year -2 Year -1 Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9
($ MM) FY2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E
Revenue $71.1 $97.0 $119.1 $139.7 $162.8 $185.6 $207.9 $228.7 $251.5 $274.2 $296.1 $319.8
% change - 36.4% 22.8% 17.3% 16.5% 14.0% 12.0% 10.0% 10.0% 9.0% 8.0% 8.0%
EBIT (GAAP) (5.5) (15.8) (21.7) (18.6) (0.4) 7.4 18.7 27.4 35.2 43.9 53.3 57.6
% Margin (7.8%) (16.3%) (18.2%) (13.3%) (0.2%) 4.0% 9.0% 12.0% 14.0% 16.0% 18.0% 18.0%
% change 186.8% 36.7% -14.1% -98.0% -2059.4% 152.0% 46.7% 28.3% 24.6% 21.5% 8.0%
Taxes 40% 0.0 0.0 0.0 0.0 0.0 3.0 7.5 11.0 14.1 17.5 21.3 23.0
Net Oper. Profit after Tax (3.3) (9.5) (13.0) (11.2) (0.2) 4.5 11.2 16.5 21.1 26.3 32.0 34.5
Deprec. & Amort. 2.4 3.1 3.8 3.9 4.1 4.3 4.5 4.7 5.0 5.2 5.5 5.8
% of revenue 3.4% 3.2% 3.2% 2.8% 2.5% 2.3% 2.2% 2.1% 2.0% 1.9% 1.9% 1.8%
CapX (3.4) (3.2) (2.9) (3.2) (2.4) (2.8) (3.1) (3.4) (3.8) (4.1) (4.4) (4.8)
% of revenue 4.8% 3.3% 2.4% 2.3% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5%
Change in WC 3.7 2.1 (12.5) 3.5 4.1 4.6 5.2 5.7 6.3 6.9 7.4 8.0
% of revenue 5.2% 2.1% -10.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5%
Free cash flow (0.7) (7.5) (24.6) (7.0) 5.5 10.6 17.8 23.5 28.6 34.3 40.5 43.6
Terminal value 703.8
Total value of cash flows (0.7) (7.5) (24.6) (7.0) 5.5 10.6 17.8 23.5 28.6 34.3 40.5 747.4
Model Assumptions 2015E 2016E
Terminal Growth Rate 4.0% DCF value of unl. FCF $330.2 $389.3
Average Borrowing Rate 5.0% DCF of NOLs 6.4 7.1
Discount Rate Components Net Debt (53.8) (51.2)
Risk Free Rate 1.8% Market cap (diluted) 390.4 447.5
+ Beta 1.2 Diluted SHOS 26.5 26.5
x Equity Risk Premium 7.2% DCF Value Per share $14.73 $16.88
= Cost of Equity 10.4%
+ After Tax Cost of Debt 3.0% Valuation Sensitivity ($/share)
x Target Debt-to-Cap Ratio 0.0% At 2Q Growth Rate
= WACC (Discount Rate) 10.44% $16.88 3.25% 3.50% 3.75% 4.0% 4.25% 4.50% 4.75%
Cash Tax Rate 40% 7.4% $28.05 $29.45 $31.05 $32.87 $34.98 $37.45 $40.37
CapX as a % of sales 1.5% 7.9% 24.87 25.94 27.14 28.49 30.02 31.78 33.81
Depreciation rate 15 8.4% 22.30 23.14 24.07 25.10 26.26 27.56 29.04
Change in net WC / sales 2.5% 8.9% 20.20 20.87 21.60 22.41 23.31 24.30 25.41
9.4% 18.44 18.99 19.58 20.22 20.93 21.71 22.57
Diluted SHOS Calculation 9.9% 16.95 17.40 17.88 18.41 18.98 19.60 20.28
Basic SHOS 25.1 10.4% 15.68 16.05 16.45 16.88 17.35 17.85 18.40
Stock options (treasury) 1.4 10.9% 14.58 14.89 15.22 15.58 15.97 16.38 16.83
Diluted SHOS 26.5 11.4% 13.61 13.88 14.16 14.46 14.78 15.13 15.50
11.9% 12.76 12.99 13.23 13.49 13.76 14.05 14.36
12.4% 12.01 12.20 12.41 12.63 12.86 13.11 13.37
12.9% 11.34 11.51 11.69 11.87 12.07 12.29 12.51
13.4% 10.73 10.88 11.04 11.20 11.37 11.56 11.75
Disc.Rate

24
IMS Health, INC. (IMS)
(IMS – RATING: OUTPERFORM; PRICE TARGET: $31)
INVESTMENT THESIS
• Well-positioned to capitalize on pharma growth driven by the
relatively high number of new molecular entities projected to be
approved by the FDA in coming years, and from overall pharma
cost-cutting and outsourcing trends as IMS's Technology Solutions
substitute for pharma IT spend and headcount.
• Beyond pharma, IMS is well-positioned to benefit from the shift by
payers and providers toward value-based care as an important
source of pricing and outcome data.
• With a 63% of revenue recurring, a diverse global client base,
steady growth, and reasonable valuation we believe IMS
represents one of the more defensive names in the Digital Health
sector.
COMPARATIVE STATS
• 2016E Sales growth: 9% (vs. Street 8%)
• Pulled in 24% from 2015 peak
$8,514
2015 2016E 2017E 2015 2016E 2017E
Consensus $2,921 $3,221 $3,407 4.3x 3.9x 3.7x
$3,221 $3,407
2015 2016E 2017E 2015 2016E 2017E
Leerink Partners 13% 10% 7% $886 $967 $1,091
Consensus 13% 10% 6% $886 $959 $1,039
2015 2016E 2017E
Consensus $1.52 $1.60 $1.77
IMS -1% 1% -14% NA
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
Canada Pension Plan Investment Board 46,512,657 14.1%
GIC Pte Ltd. (Investment Management) 30,678,561 9.3%
T. Row e Price Associates, Inc. 8,576,802 2.6%
Lateef Investment Management LP 7,917,048 2.4%
Harding Loevner LP 7,587,171 2.3%
Valinor Management LP 5,278,032 1.6%
Steadfast Capital Management LP 5,278,032 1.6%
EV/Sales
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Sales (mil)
$10.00
$15.00
$20.00
$25.00
$30.00
$35.00
$40.00

25
IMS Health - standalone
Income Statement - FY end December ($MM) Mar-16 Jun-16 Sep-16 Dec-16
2013A 2014A 2015A Q1A Q2E Q3E Q4E 2016E 2017E
Information Revenue $1,525.7 $1,515.0 $1,483.0 $376.0 $381.5 $374.9 $376.3 $1,508.6 $1,527.5
Grow th y/y 0.3% -0.7% -2.1% 6.0% 2.0% 0.5% -1.5% 1.7% 1.3%
% Total 60% 57% 51% 49% 48% 48% 44% 47% 44%
Technology Services Revenue $1,018.6 $1,126.0 $1,438.0 $398.0 $419.5 $409.1 $485.9 $1,712.5 $1,926.5
Grow th y/y 10.5% 10.5% 27.7% 43.6% 14.0% 13.0% 13.0% 19.1% 12.5%
% Total 40% 43% 49% 51% 52% 52% 56% 53% 56%
Total Revenue $2,544.3 $2,641.0 $2,921.0 $774.0 $801.0 $783.9 $862.2 $3,221.1 $3,454.1
Grow th y/y 4.2% 3.8% 10.6% 22.5% 8.0% 6.7% 6.2% 10.3% 7.2%
Costs of Information revenue 645.6 665.0 666.0 160.0 171.7 167.2 169.7 668.6 673.6
% of information revenue 42.3% 43.9% 44.9% 42.6% 45.0% 44.6% 45.1% 44.3% 44.1%
Information Revenue Gross Profit 880.1 850.0 817.0 216.0 209.8 207.7 206.6 840.1 853.9
Information Gross Margin 57.7% 56.1% 55.1% 57.4% 55.0% 55.4% 54.9% 55.7% 55.9%
Costs of Tech svcs 517.5 573.0 750.0 222.0 226.5 216.8 252.7 918.0 1,028.0
% of tech svcs revenue 50.8% 50.9% 52.2% 55.8% 54.0% 53.0% 52.0% 53.6% 53.4%
Tech Gross Profit 501.1 553.0 688.0 176.0 193.0 192.3 233.2 794.5 898.6
Tech Gross Margin 49.2% 49.1% 47.8% 44.2% 46.0% 47.0% 48.0% 46.4% 46.6%
Total Costs of Revenue 1,163.1 1,238.0 1,416.0 382.0 398.2 384.0 422.4 1,586.6 1,701.6
Total Gross Profit 1,381.2 1,403.0 1,505.0 392.0 402.8 399.9 439.8 1,634.5 1,752.5
gross margin % 54.3% 53.1% 51.5% 50.6% 50.3% 51.0% 51.0% 50.7% 50.7%
SG&A 570.9 690.0 712.0 177.0 188.2 184.2 202.6 752.1 773.7
% of revenue 22.4% 26.1% 24.4% 22.9% 23.5% 23.5% 23.5% 23.3% 22.4%
Grow th y/y 2.5% 20.9% 3.2% 29.2% 4.6% 1.8% -5.3% 5.6% 2.9%
Equity comp 22.0 31.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Restructuring Cost 16.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Other Operating Expenses 7.9 33.0 88.0 15.0 15.0 15.0 15.0 60.0 0.0
Depreciation & Amortization 410.2 441.0 341.0 87.0 87.0 87.0 87.0 348.0 352.0
Operating Income $353.9 $208.0 $364.0 $113.0 $112.6 $113.7 $135.2 $474.5 $626.7
Operating margin % 13.9% 7.9% 12.5% 14.6% 14.1% 14.5% 15.7% 14.7% 18.1%
Grow th y/y 48.1% -41.2% 75.0% 24.2% 17.2% 27.8% 53.6% 30.3% 32.1%
Non-Operating Income (74.4) (276.0) 19.0 (5.0) 0.0 0.0 0.0 (5.0) 0.0
EBIT $279.5 ($68.0) $383.0 $108.0 $112.6 $113.7 $135.2 $469.5 $626.7
Interest Income (Expense), net (327.8) (217.0) (166.0) (45.0) (43.0) (43.0) (43.0) (174.0) (160.0)
Pretax Income (48.3) (285.0) 217.0 63.0 69.6 70.7 92.2 295.5 466.7
Pretax Margin % -1.9% -10.8% 7.4% 8.1% 8.7% 9.0% 10.7% 9.2% 13.5%
Taxes Benefit (Expense) 130.1 96.0 200.0 (20.0) (22.1) (22.4) (29.3) (93.8) (144.7)
Tax Rate % 269.4% 33.7% -92.2% 31.7% 31.7% 31.7% 31.7% 31.7% 31.0%
Net (Loss) Income 81.8 (189.0) 417.0 43.0 47.5 48.3 62.9 201.7 322.1
Non-controlling Interest 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Income Attributable to IMS Health $81.8 ($189.0) $417.0 $43.0 $47.5 $48.3 $62.9 $201.7 $322.1
Growth y/y 293.4% -331.1% 320.6% -85.6% 1.0% 12.2% 117.0% -51.6% 59.7%
GAAP EPS $0.29 ($0.59) $1.22 $0.13 $0.14 $0.14 $0.19 $0.60 $0.95
Adjusted EPS $1.34 $1.37 $1.52 $0.42 $0.38 $0.37 $0.43 $1.60 $1.79
Growth y/y 29.5% 2.0% 11.1% 5.9% 2.6% -2.4% 16.3% 5.2% 12.5%
(Unadjusted) Basic Shares 280.0 318.9 331.1 328.6 324.6 324.6 324.6 325.6 327.1
(Adjusted) Diluted Shares 287.0 328.6 339.4 335.6 335.6 335.6 335.6 335.6 338.1

26
IMS Fair Value in 12 Months 2017E
Diluted Adj. EPS $1.79
Price Target $30.51
upside 18%
Source: Leerink Partners estimates

27
MEDIDATA SOLUTIONS, INC. (MDSO)
(MDSO – RATING: MARKET PERFORM; PRICE TARGET: $47)
INVESTMENT THESIS
• Market leading position in clinical trial management software
• A good play on pharma outsourcing trend to tech enabled vendors
• Heavy opex spending likely to weigh on estimates in 2016/17
• Cautious on the stock due to high valuation, and limited visibility on
large platform deals which now drive revenue upside
COMPARATIVE STATS
• 2016E Sales growth: 17% (vs. consensus at 18%)
• Public since 2009, trading at 36x FY17 EPS vs. historical avg of 33x
$2,725
2015 2016E 2017E 2015 2016E 2017E
Consensus $393 $461 $551 6.8x 5.8x 4.8x
$461 $551
2015 2016E 2017E 2015 2016E 2017E
Leerink Partners 13% 17% 19% $886 $951 $1,053
Consensus 13% 18% 19% $886 $105 $131
2015 2016E 2017E
Consensus $0.90 $1.01 $1.23
MDSO 4% -4% -13% 42%
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
Brow n Capital Management LLC 6,205,838 10.8%
Sands Capital Management LLC 4,140,854 7.2%
Columbia Wanger Asset Management LLC 1,863,871 3.3%
ClearBridge Investments LLC 1,711,461 3.0%
Champlain Investment Partners LLC 1,412,371 2.5%
Apex Capital Management, Inc. 1,160,837 2.0%
SSgA Funds Management, Inc. 1,153,962 2.0%
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
$20.00
$25.00
$30.00
$35.00
$40.00
$45.00
$50.00
$55.00
$60.00
$65.00
$70.00
Price Performance Past 3 Years

28
Medidata Solutions, Inc. (MDSO)
$ in Thousands FY2012A FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
Total revenues 218,347 276,849 335,071 392,506 104,238 111,935 119,106 125,495 460,774 548,270
q/q 5.4% 7.4% 6.4% 5.4%
y/y 26.8% 21.0% 17.1% 12.8% 14.1% 15.5% 26.9% 17.4% 19.0%
Total cost of revenues 62,662 69,909 84,920 89,788 24,668 25,458 25,919 26,446 102,491 117,366
% of revenue 28.7% 25.3% 25.3% 22.9% 23.7% 22.7% 21.8% 21.1% 22.2% 21.4%
Gross profit 155,685 206,940 250,151 302,718 79,570 86,477 93,187 99,049 358,283 430,904
% margin 71.3% 74.7% 74.7% 77.1% 76.3% 77.3% 78.2% 78.9% 77.8% 78.6%
Operating costs and expenses: 2.2%
Research and development 42,276 51,202 71,757 92,319 28,228 28,543 30,372 31,374 118,517 142,550
% of revenue 19.4% 18.5% 21.4% 23.52% 27.1% 25.5% 25.5% 25.0% 25.7% 26.0%
y/y 40.1% 28.7% 28.4% 20.3%
Sales and marketing 47,739 66,337 83,435 103,153 25,458 29,103 29,657 34,135 118,353 138,528
% of revenue 21.9% 24.0% 24.9% 26.3% 24.4% 26.0% 24.9% 27.2% 25.7% 25.3%
y/y 25.8% 23.6% 14.7% 17.0%
General and administrative 37,777 65,513 69,111 78,014 19,246 22,947 21,439 20,079 83,711 86,696
% of revenue 17.3% 23.7% 20.6% 19.9% 18.5% 20.5% 18.0% 16.0% 18.2% 15.8%
y/y 5.5% 12.9% 7.3% 3.6%
Litigation settlement / Wire transaction loss - - 5,784 - - - - - - -
% of revenue 1.7% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Total operating costs and expenses 127,792 183,052 230,087 273,486 72,932 80,593 81,468 85,588 320,581 367,774
y/y 43% 26% 19% 17% 15%
Operating income (loss) 27,893 23,888 20,064 29,232 6,638 5,884 11,719 13,461 37,702 63,130
% margin 12.8% 8.6% 6.0% 7.4% 6.4% 5.3% 9.8% 10.7% 8.2% 11.5%
y/y -14.4% (16%) 45.7% 29.0% 67.4%
Total interest and other expense, net 176 (5,506) (13,550) (13,457) (3,259) (3,392) (3,442) (3,492) (13,585) (14,068)
Income (loss) before income taxes 28,069 18,382 6,514 15,775 3,379 2,492 8,277 9,969 24,117 49,062
Provision for income taxes 10,049 1,721 422 2,608 (2,469) 872 2,897 3,489 4,789 17,172
Tax rate 35.8% 9.4% 6.5% 16.5% -73.1% 35.0% 35.0% 35.0% 19.9% 35.0%
Net income (loss) 18,020 16,661 6,092 13,167 5,848 1,620 5,380 6,480 19,328 31,890
% margin 8.3% 6.0% 1.8% 3.4% 5.6% 1.4% 4.5% 5.2% 4.2% 5.8%
GAAP earnings per share:
Basic $0.73 $0.33 $0.12 $0.25 $0.11 $0.03 $0.10 $0.11 $0.34 $0.55
Diluted $0.71 $0.31 $0.11 $0.23 $0.10 $0.03 $0.09 $0.11 $0.34 $0.54
y/y (56%) (64%) 111% 45% 60%
Weighted avg. common shares outstanding
Basic 24,546 51,060 52,561 53,717 55,119 55,819 56,419 56,919 56,069 57,769
Diluted 25,469 54,118 55,247 56,540 56,365 57,065 57,665 58,165 57,315 59,015
Reconciliation of GAAP to Non-GAAP FY2012A FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
Net income:
GAAP net income 18,020 16,661 6,092 13,167 5,848 1,620 5,380 6,480 19,328 31,890
Stock-based compensation 10,914 36,143 37,953 48,987 10,250 14,000 12,700 12,000 48,950 49,200
Amortization 1,792 804 628 636 103 180 130 130 543 520
Non-cash interest expense on convertible senior notes - 4,715 12,458 13,180 3,408 3,450 3,500 3,550 13,908 14,700
Tax impact on add-back items (4,689) (16,760) (22,729) (25,121) (5,504) (7,052) (6,532) (6,272) (25,360) (25,768)
Adj. non-GAAP net income 26,356 41,802 40,186 50,849 14,105 12,198 15,178 15,888 57,369 70,542
Adj. non-GAAP basic EPS $1.07 $0.82 $0.76 $0.95 $0.26 $0.22 $0.27 $0.28 $1.02 $1.22
Adj. non-GAAP diluted EPS $1.03 $0.77 $0.73 $0.90 $0.25 $0.21 $0.26 $0.27 $1.00 $1.20

29
Medidata Solutions, Inc.
FYE Dec. 31, GAAP Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
thousands of $ FY2012A FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E 1Q:17E 2Q:17E 3Q:17E 4Q:17E FY2017E
Revenues:
Application Services 171,647 227,921 280,041 336,195 89,968 97,165 103,967 110,205 401,306 113,511 119,187 125,146 127,649 485,493
% of total revenue 78.6% 82.3% 83.6% 85.7% 86.3% 86.8% 87.3% 87.8% 87.1% 88.1% 88.4% 88.7% 88.9% 88.5%
q/q 6.3% 8.0% 7.0% 6.0% 3.0% 5.0% 5.0% 2.0%
y/y 32.8% 22.9% 20.1% 14.2% 15.8% 17.0% 30.2% 19.4% 26.2% 22.7% 20.4% 15.8% 21.0%
Professional Services 46,700 48,928 55,030 56,311 14,270 14,769 15,139 15,290 59,468 15,290 15,672 15,907 15,907 62,777
% of total revenue 21.4% 17.7% 16.4% 14.3% 13.7% 13.2% 12.7% 12.2% 12.9% 11.9% 11.6% 11.3% 11.1% 11.5%
q/q 0.3% 3.5% 2.5% 1.0% 0.0% 2.5% 1.5% 0.0%
y/y 4.8% 12.5% 2.3% 4.2% 4.3% 6.3% 7.4% 5.6% 7.1% 6.1% 5.1% 4.0% 5.6%
Total revenues 218,347 276,849 335,071 392,506 104,238 111,935 119,106 125,495 460,774 128,801 134,859 141,054 143,556 548,270
q/q 5.4% 7.4% 6.4% 5.4% 2.6% 4.7% 4.6% 1.8%
y/y 26.8% 21.0% 17.1% 12.8% 14.1% 15.5% 26.9% 17.4% 23.6% 20.5% 18.4% 14.4% 19.0%
Cost of revenues:
Subscription 32,600 37,053 45,576 47,795 14,329 14,380 14,867 15,208 58,785 18,079 17,640 17,896 17,616 71,230
% of total costs 52.0% 53.0% 53.7% 53.2% 58.1% 56.5% 57.4% 57.5% 57.4% 62.0% 60.0% 60.6% 60.1% 60.7%
y/y 13.7% 23.0% 4.9% 24.9% 16.4% 19.0% 32.5% 23.0% 26.2% 22.7% 20.4% 15.8% 21.2%
Professional services 30,062 32,856 39,344 41,993 10,339 11,077 11,051 11,238 43,706 11,078 11,754 11,612 11,692 46,137
% of total costs 48.0% 47.0% 46.3% 46.8% 41.9% 43.5% 42.6% 42.5% 42.6% 38.0% 40.0% 39.4% 39.9% 39.3%
y/y 9.3% 19.7% 6.7% -3.4% 4.9% 7.3% 7.8% 4.1% 7.1% 6.1% 5.1% 4.0% 5.6%
Total cost of revenues 62,662 69,909 84,920 89,788 24,668 25,458 25,919 26,446 102,491 29,157 29,394 29,508 29,308 117,366
y/y 11.6% 21.5% 5.7% 11.2% 11.1% 13.7% 20.7% 14.1% 18.2% 15.5% 13.9% 10.8% 14.5%
Margins:
Subscription gross income 139,047 190,868 234,465 288,400 75,639 82,785 89,100 94,997 342,520 95,433 101,547 107,250 110,033 414,263
% gross margin 81.0% 83.7% 83.7% 85.8% 84.1% 85.2% 85.7% 86.2% 85.4% 84.1% 85.2% 85.7% 86.2% 85.3%
Professional services gross income 16,638 16,072 15,686 14,318 3,931 3,692 4,087 4,052 15,763 4,212 3,918 4,295 4,215 16,641
% gross margin 35.6% 32.8% 28.5% 25.4% 27.5% 25.0% 27.0% 26.5% 26.5% 27.5% 25.0% 27.0% 26.5% 26.5%
Total gross income 155,685 206,940 250,151 302,718 79,570 86,477 93,187 99,049 358,283 99,645 105,465 111,545 114,249 430,904
% gross margin 71.3% 74.7% 74.7% 77.1% 76.3% 77.3% 78.2% 78.9% 77.8% 77.4% 78.2% 79.1% 79.6% 78.6%

30
NUANCE COMMUNICATIONS, INC. (NUAN)
(NUAN – RATING: OUTPERFORM; PRICE TARGET: $22)
INVESTMENT THESIS
• Healthcare IT leader with dominant position in speech recognition
technology, a key enabler of workflow automation
• Turnaround story with new product growth in Healthcare and
Mobile & Consumer segments offset by legacy business declines
and revenue model transition toward subscription
• Double-digit earnings growth potential driven by expense reduction
and stock buyback programs
• Longer term, stock provides call options on post-Meaningful Use
hospital spend and on Internet of Things.
COMPARATIVE STATS
• 2016E Sales growth: 2% (vs. consensus at 1%)
• At 10x FY17 EPS, a rare value stock in Digital Health
$4,881
2015 2016E 2017E 2015 2016E 2017E
Consensus $1,979 $1,990 $2,045 3.4x 3.4x 3.3x
$1,990 $2,045
2015 2016E 2017E 2015 2016E 2017E
Consensus 13% 1% 3% $519 $560 $596
2015 2016E 2017E
Consensus $1.27 $1.53 $1.66
NUAN 5% -12% 0% -8%
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
Icahn Associates Holding LLC 30,068,879 10.8%
ClearBridge Investments LLC 25,922,506 9.3%
PRIMECAP Management Co. 13,963,642 5.0%
FIL Investment Advisors (UK) Ltd 9,822,854 3.5%
Fairpointe Capital LLC 5,902,647 2.1%
Columbia Management Investment Advisers LLC 5,023,114 1.8%
SSgA Funds Management, Inc. 4,872,337 1.7%
Columbus Circle Investors 4,255,267 1.5%
EV/Sales
Revenue Growth Non-GAAP EBIT
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Sales (mil)
$10.00
$12.00
$14.00
$16.00
$18.00
$20.00
$22.00
$24.00

31
Nuance Communications
Income Statement for FYE Sept (non-GAAP) Dec-15 Mar-16 Jun-16 Sep-16
($m) FY2012A FY2013A FY2014A FY2015A 1Q:16A 2Q:16A 3Q:16E 4Q:16E FY2016E FY2017E
Revenue Components (Non-GAAP)
Product and licensing (non-GAAP) 814.8$ 823.8$ 748.3$ 729.2$ 185.0$ 164.3$ 163.0$ 185.0$ 697.3$ 700.0$
q/q -5.3% -11.2% -0.8% 13.5%
y/y NA 1.1% (9.2%) (2.5%) 2.6% -10.5% -4.1% -5.3% (4.4%) 0.4%
% of revenue 46.9% 42.1% 37.7% 36.8% 37.4% 33.7% 33.2% 35.7% 35.0% 34.5%
Professional services and hosting (non-GAAP) 679.8 859.6 934.0 932.6 229.7 243.1 245.0 250.0 967.8 993.0
y/y NA 26.4% 8.7% (0.2%) -0.1% 6.7% 3.2% 5.3% 3.8% 2.6%
% of revenue 39.1% 43.9% 47.0% 47.1% 46.4% 49.9% 49.8% 48.3% 48.6% 48.9%
Maintenance and support (non-GAAP) 243.5 274.3 304.8 317.2 80.2 80.0 83.5 83.0 326.7 336.0
y/y NA 12.7% 11.1% 4.1% 1.8% 4.4% 2.7% 3.0% 3.0% 2.9%
% of revenue 14.0% 14.0% 15.3% 16.0% 16.2% 16.4% 17.0% 16.0% 16.4% 16.6%
Total revenues (non-GAAP) 1,738.1 1,957.6 1,987.1 1,979.1 494.9 487.4 491.5 518.0 1,991.8 2,029.0
q/q -3.6% -1.5% 0.8% 5.4%
y/y NA 12.6% 1.5% -0.4% 1.2% -0.1% 0.6% 0.9% 0.6% 1.9%
Cost of Revenues (non-GAAP)
Product and licensing 83.0 105.5 99.7 92.9 23.3 20.7 19.6 21.6 85.2 83.4
% margin 89.8% 87.2% 86.7% 87.3% 87.4% 87.5% 88.0% 88.3% 87.8% 88.1%
Professional services and hosting 398.8 534.7 602.4 590.1 146.0 147.2 153.1 155.0 601.2 619.1
% margin 41.3% 37.8% 35.5% 36.7% 36.4% 36.8% 37.5% 38.0% 37.9% 37.7%
Maintenance and support 44.4 49.2 49.1 50.5 12.3 12.7 12.5 12.3 49.8 50.1
% margin 81.8% 82.1% 83.9% 84.1% 84.7% 84.7% 85.0% 85.2% 84.8% 85.1%
Total cost of revenues (non-GAAP) 526.1 689.4 751.3 733.5 181.5 180.6 185.2 188.9 736.2 752.6
% cost of revenues / rev. 30.3% 35.2% 37.8% 37.1% 36.7% 37.0% 37.7% 36.5% 37.0% 37.1%
Gross profit (non-GAAP) 1,212.0 1,268.2 1,235.8 1,245.5 313.4 306.8 306.3 329.1 1,255.6 1,276.4
% margin 69.7% 64.8% 62.2% 62.9% 63.3% 63.0% 62.3% 63.5% 63.0% 62.9%
Operating expenses (non-GAAP)
Research and development 195.9 257.1 294.4 271.3 61.1 59.3 68.3 71.5 260.2 263.8
% of revenue 11.3% 13.1% 14.8% 13.7% 12.4% 14.1% 13.9% 13.8% 13.1% 13.0%
Sales and marketing 314.9 361.733 371.1 360.6 87.8 82.4 85.0 88.6 343.7 334.8
% of revenue 18.1% 18.5% 18.7% 18.2% 17.7% 17.5% 17.3% 17.1% 17.3% 16.5%
General and administrative 100.1 133.0 125.5 130.5 29.0 35.0 27.5 28.5 120.0 111.6
% of revenue 5.8% 6.8% 6.3% 6.6% 5.9% 5.9% 5.6% 5.5% 6.0% 5.5%
Restructuring and other charges (gains), net (21.0) (30.3) (26.9) (35.4) (5.9) (8.0) (5.9) (6.2) (26.0) (24.3)
% of revenue (1.2%) (1.5%) (1.4%) (1.8%) (1.2%) (1.2%) (1.2%) (1.2%) (1.3%) (1.2%)
Total operating expenses (non-GAAP) 589.9 721.5 764.1 726.9 172.1 168.6 175.0 182.3 698.0 685.8
y/y (4.9%) (4.0%) (1.7%)
Income from operations (EBIT) (Non-GAAP) 622.1 546.7 471.7 518.6 141.3 138.2 131.3 146.7 557.6 590.6
% margin 35.8% 27.9% 23.7% 26.2% 28.6% 28.4% 26.7% 28.3% 28.0% 29.1%
Interest and other expense, net (47.1) (97.7) (94.1) (87.6) (22.151) (18.0) (19.3) (19.3) (78.7) (79.6)
Income (loss) before income taxes (EBT) (non-GAAP) 575.0 449.0 377.6 431.0 119.2 120.2 112.0 127.5 478.8 511.0
Provision (benefit) for income taxes 19.1 21.0 17.5 19.3 6.2 5.2 6.7 7.6 25.7 28.1
% income tax / EBT 3.3% 4.7% 4.6% 4.5% 5.2% 4.3% 6.0% 6.0% 5.4% 5.5%
Net income (loss) (non-GAAP) 555.927$ 428.0$ 360.1$ 411.7$ 113.0$ 115.0$ 105.3$ 119.8$ 453.1$ 482.9$
Net income per share (non-GAAP):
Diluted WASO EPS $1.73 $1.33 $1.12 $1.27 $0.36 $0.38 $0.37 $0.40 $1.52 $1.64
y/y (23.5%) (15.5%) 13.6% 19.4% 7.7%

32
Nuance Communications Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17
Revenue Build ($MM) FY2012A FY2013A FY2014A 1Q:15A 2Q:15A 3Q:15A 4Q:15A FY2015A 1Q:16A 2Q:16A 3Q:16E 4Q:16E FY2016E 1Q:17E 2Q:17E 3Q:17E 4Q:17E FY2017E
Healthcare
GAAP Revenue $668.6 $873.8 925.4 247.7 240.2 247.0 255.0 989.9 245.4 242.1 250.1 259.1 996.7 248.7 245.5 260.1 268.1 1,022.4
q/q 5.4% (3.0%) 2.8% 3.2% (3.8%) (1.3%) 3.3% 3.6% (4.0%) (1.3%) 5.9% 3.1%
Growth y/y NA 30.7% 5.9% 11.8% 3.3% 4.6% 8.5% 7.0% -0.9% 0.8% 1.3% 1.6% 0.7% 1.4% 1.4% 4.0% 3.5% 2.6%
% of total 40% 47% 48% 52% 51% 52% 51% 51% 50% 51% 52% 51% 51% 51% 51% 52% 51% 51%
Adjustment 0.8 37.7 17.3 3.1 3.1 2.4 2.1 10.7 2.7 2.3 2.3 2.1 9.3 2.0 2.0 2.1 2.1 8.2
% of GAAP 1.3% 1.3% 1.0% 0.8% 1.1% 1.0% 0.9% 0.8% 0.8% 0.8% 0.8% 0.8%
Non-GAAP Revenue 669.4 911.5 942.7 250.8 243.3 249.4 257.1 1,000.6 248.1 244.4 252.3 261.2 1,006.0 250.7 247.5 262.2 270.3 1,030.6
Growth y/y NA 36.2% 3.4% 10.3% 2.7% 3.9% 7.9% 6.1% -1.1% 0.5% 1.2% 1.6% 0.5% 1.0% 1.2% 3.9% 3.5% 2.4%
% of total 39% 47% 47% 51% 50% 51% 50% 51% 50% 50% 51% 50% 51% 51% 50% 52% 51% 51%
y/y Organic - stated 11% 1% 1% -3% -5% -2% -1% -2% -1% 1%
Mobile & Consumer
GAAP Revenue 482.9 467.7 438.8 85.7 100.2 94.3 104.1 384.3 95.0 89.9 94.3 104.1 383.3 90.3 89.3 99.0 107.7 386.3
q/q (23.7%) 16.9% (5.9%) 10.4% (8.7%) (5.4%) 5.0% 10.4% (13.3%) (1.1%) 10.9% 8.8%
Growth y/y NA -3.1% -6.2% -23.8% -6.4% -11.9% -7.3% -12.4% 10.9% -10.3% 0.0% 0.0% -0.3% -5.0% -0.7% 5.0% 3.5% 0.8%
% of total 29% 25% 23% 18% 21% 20% 21% 20% 20% 19% 20% 20% 20% 19% 18% 20% 20% 19%
Adjustment 25.3 11.5 9.7 1.8 1.7 1.7 1.6 6.8 1.4 2.0 0.9 0.9 5.2 0.7 0.7 0.7 0.8 2.9
% of GAAP 2.1% 1.7% 1.8% 1.5% 1.5% 2.2% 1.0% 0.9% 0.8% 0.8% 0.7% 0.7%
Non-GAAP Revenue 508.2 479.2 448.5 87.5 101.9 96.0 105.7 391.1 96.4 91.8 95.2 105.0 388.5 91.0 90.0 99.7 108.5 389.2
Growth y/y NA -5.7% -6.4% -24.1% -7.2% -12.0% -7.5% -12.8% 10.2% -9.9% -0.8% -0.6% -0.7% -5.6% -2.0% 4.7% 3.3% 0.2%
% of total 29% 24% 23% 18% 21% 20% 21% 20% 19% 19% 19% 20% 20% 18% 18% 20% 20% 19%
y/y Organic - stated 23% -8% -5% 5% 15% -5% 3% 4% 0% -16%
Enterprise
GAAP Revenue 315.0 320.2 352.3 89.8 82.6 86.4 87.9 346.7 88.3 93.7 87.3 88.8 358.0 89.2 95.5 89.9 90.6 365.1
q/q (7.3%) (8.0%) 4.6% 1.7% 0.5% 6.1% (6.8%) 1.7% 0.5% 7.1% (5.9%) 0.7%
Growth y/y NA 1.7% 10.0% 3.7% -3.2% 3.5% -9.3% -1.6% -1.7% 13.4% 1.0% 1.0% 3.3% 1.0% 2.0% 3.0% 2.0% 2.0%
% of total 19% 17% 18% 19% 17% 18% 17% 18% 18% 20% 18% 17% 18% 18% 20% 18% 17% 18%
Adjustment 17.0 3.3 7.3 0.9 0.7 0.6 0.5 2.7 0.5 0.8 0.3 0.3 1.9 0.3 0.3 0.3 0.3 1.1
% of GAAP 1.0% 0.8% 0.7% 0.6% 0.6% 0.8% 0.4% 0.3% 0.3% 0.3% 0.3% 0.3%
Non-GAAP Revenue 332.0 323.5 359.6 90.7 83.3 87.0 88.4 349.4 88.8 94.4 87.6 89.0 359.9 89.5 95.8 90.2 90.8 366.2
Growth y/y NA -2.6% 11.2% 1.7% -4.5% 2.2% -9.9% -2.8% -2.1% 13.3% 0.7% 0.7% 3.0% 0.7% 1.5% 2.9% 2.0% 1.8%
% of total 19% 17% 18% 19% 17% 18% 17% 18% 18% 19% 18% 17% 18% 18% 19% 18% 17% 18%
y/y Organic - stated 7% -2% -6% -4% -7% 0% -10% -5% -2% 13%
Imaging
GAAP Revenue 184.9 193.6 207.0 50.8 52.0 50.2 57.0 210.0 57.4 53.1 51.2 58.1 219.8 58.3 54.4 52.7 59.6 225.0
q/q (12.4%) 2.4% (3.5%) 13.5% 0.7% (7.5%) (3.6%) 13.5% 0.2% (6.6%) (3.1%) 13.0%
Growth y/y NA 4.7% 6.9% 3.0% 2.2% 2.9% -1.7% 1.4% 13.0% 2.1% 2.0% 2.0% 4.7% 1.5% 2.5% 3.0% 2.5% 2.4%
% of total 11% 10% 11% 11% 11% 11% 11% 11% 12% 11% 11% 11% 11% 12% 11% 11% 11% 11%
Adjustment 43.5 49.8 29.3 9.2 7.5 6.1 4.9 27.7 4.2 3.6 5.1 4.7 17.6 4.7 4.4 4.2 4.8 18.0
% of GAAP 18.1% 14.4% 12.2% 8.6% 7.3% 6.8% 10.0% 8.0% 8.0% 8.0% 8.0% 8.0%
Non-GAAP Revenue 228.4 243.4 236.3 60.0 59.5 56.3 61.9 237.7 61.6 56.7 56.3 62.8 237.4 62.9 58.8 57.0 64.4 243.0
Growth y/y NA 6.6% -2.9% 2.9% 6.3% 7.2% -10.9% 0.6% 2.7% -4.7% 0.0% 1.4% -0.1% 2.1% 3.7% 1.1% 2.5% 2.4%
% of total 13% 12% 12% 12% 12% 12% 12% 12% 12% 12% 11% 12% 12% 13% 12% 11% 12% 12%
y/y Organic - stated 7% -5% -5% -9% -7% -8% -11% -9% 3% -5%
Total Revenue
GAAP Revenue 1,651.4 1,855.3 1,923.5 474.0 475.0 477.9 504.0 1,930.9 486.1 478.7 482.9 510.1 1,957.8 486.4 484.7 501.7 526.0 1,998.9
q/q (5.6%) 0.2% 0.6% 5.5% (3.6%) (1.5%) 0.9% 5.6% (4.6%) (0.3%) 3.5% 4.8%
Growth y/y NA 12.3% 3.7% 0.9% -0.1% 0.5% 0.3% 0.4% 2.6% 0.8% 1.0% 1.2% 1.4% 0.1% 1.3% 3.9% 3.1% 2.1%
% of total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Adjustment 86.6 102.3 63.6 15.0 13.0 10.8 9.1 47.9 8.8 8.6 8.7 7.9 34.0 7.6 7.3 7.3 7.9 30.2
Non-GAAP Revenue 1,738.0 1,957.6 1,987.1 489.0 488.0 488.7 513.1 1,978.8 494.9 487.3 491.5 518.0 1,991.7 494.0 492.0 509.0 534.0 2,029.0
Growth y/y NA 13% 2% -0.2% -0.4% 0.4% -1.4% 0% 1.2% -0.1% 0.6% 1.0% 0.7% -0.2% 1.0% 3.6% 3.1% 1.9%
% of total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
y/y Organic - stated 13% -3% -2% -2% -2% -3% -3% -2% -1% -1%

33
PRESS GANEY (PGND)
(PGND – RATING: MARKET PERFORM; PRICE TARGET: $33)
INVESTMENT THESIS
• Pure play on patient experience measurement which is increasingly
tied to hospital reimbursement through CMS mandated CAHPS
programs. As commercial payers shift to value-based care, quality
measures as reported by the patient will become more important,
benefitting Press Ganey.
• Market leader with longstanding customer relationships, 94%
recurring revenue and stable margins.
• Stock appears fairly valued relative to 7-9% organic topline and 10-
15% bottom line growth rates. Some upside potential from
acquisitions.
COMPARATIVE STATS
• 2016E Sales growth: 14% (in line with consensus)
• IPO in May 2015 at $25
$1,938
2015 2016E 2017E 2015 2016E 2017E
Consensus $319 $363 $395 6.6x 5.8x 5.3x
$363 $395
2015 2016E 2017E 2015 2016E 2017E
Consensus 13% 14% 9% $117 $138 $153
2015 2016E 2017E
Consensus $0.94 $1.10 $1.23
PGND 8% 16% NA NA
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
BAMCO, Inc. 2,394,785 4.5%
Goldman Sachs & Co. (Private Banking) 1,552,645 2.9%
TimesSquare Capital Management LLC 1,392,464 2.6%
Lord, Abbett & Co. LLC 1,314,753 2.5%
William Blair & Co. LLC (Investment Management) 1,082,675 2.0%
Brow n Advisory LLC 659,227 1.2%
Loomis, Sayles & Co. LP 607,419 1.1%
Capital Research & Management Co. (World Investors) 600,018 1.1%
Fidelity Management & Research Co. 595,789 1.1%
EV/Sales
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Sales (mil)
$10.00
$15.00
$20.00
$25.00
$30.00
$35.00
$40.00

34
Press Ganey (PGND)
$ in Thousands FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
Revenue 281,612 318,694 86,731 88,899 92,011 95,691 363,332 392,459
y/y 8.1% 13.2% 15.8% 14.8% 14.0% 11.8% 14.0% 8.0%
Operating expenses:
Cost of revenue, excluding D&A 121,807 149,235 36,469 38,227 39,565 41,147 155,408 166,795
Gross Margin % 56.7% 53.2% 58.0% 57.0% 57.0% 57.0% 57.2% 57.5%
% of revenue 43.3% 46.8% 42.0% 43.0% 43.0% 43.0% 42.8% 42.5%
y/y 7% 23% 4% 7%
General and administrative 70,432 143,561 22,644 23,114 23,923 24,880 94,560 98,115
% of revenue 25.0% 45.0% 26.1% 26.0% 26.0% 26.0% 26.0% 25.0%
y/y -2% 104% -34% 4%
Depreciation and amortization 35,102 41,224 11,572 11,735 11,961 12,153 47,421 50,712
% of revenue 12.5% 12.9% 13.3% 13.2% 13.0% 12.7% 13.1% 12.9%
Loss (gain) on disposal of property and equipment 1,719 307 18 - - - 18 -
% of revenue 0.6% 0.1% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Total operating expenses 229,060 334,327 70,703 73,075 75,449 78,180 297,407 315,622
y/y 4% 46% -11% 6%
Income (loss) from operations 52,552 (15,633) 16,028 15,824 16,562 17,511 65,925 76,837
Operating Margin % 18.7% -4.9% 18.5% 17.8% 18.0% 18.3% 18.1% 19.6%
Interest expense, net (19,832) (11,163) (1,230) (1,150) (1,150) (1,150) (4,680) (4,500)
Extinguishmnet of debt (2,894) (1,750) - - - - - -
Management fee of related party (1,047) (553) - - - - - -
Total other income (expense) (23,773) (13,466) (1,230) (1,150) (1,150) (1,150) (4,680) (4,500)
Income (loss) before taxes 28,779 (29,099) 14,798 14,674 15,412 16,361 61,245 72,337
Income tax (benefit) provision 13,196 7,528 6,680 6,624 6,957 7,386 27,647 32,552
Tax rate 45.9% (25.9%) 45.1% 45% 45% 45% 45.1% 45.0%
GAAP Net Income (loss) 15,583 (36,627) 8,118 8,050 8,455 8,976 33,599 39,785
Basic EPS - GAAP $0.36 ($0.75) $0.15 $0.15 $0.16 $0.17 $0.63 $0.73
Diluted EPS - GAAP $0.36 ($0.75) $0.15 $0.15 $0.16 $0.17 $0.63 $0.73
Weighted-average shares outstanding:
Basic 43,313 48,891 52,806 53,552 53,820 54,089 53,567 54,496
Diluted 43,313 48,891 53,286 53,552 53,820 54,089 53,687 54,496
Diluted Pro-forma EPS $0.74 $0.94 $0.27 $0.27 $0.28 $0.28 $1.10 $1.23
y/y 28% 21% 20% 12% 18% 17% 12%
Reconciliation to EBITDA and Adj. EBITDA (Non-GAAP)
GAAP Net Income (loss) 15,583 (36,627) 8,118 8,050 8,455 8,976 33,599 39,785
Interest expense, net 19,832 11,163 1,230 1,150 1,150 1,150 4,680 4,500
Provision for (benefit from) income taxes 13,196 7,528 6,680 6,624 6,957 7,386 27,647 32,552
Depreciation and amortization 35,102 41,224 11,572 11,735 11,961 12,153 47,421 50,712
EBITDA 83,713 23,288 27,600 27,559 28,523 29,664 113,346 127,549
Adjustments:
Equity-based compensation 8,034 86,746 6,001 6,001 6,001 6,001 24,004 26,000
Adjusted EBITDA 102,559 117,485 33,791 33,750 34,714 35,855 138,110 154,309
margin % 36.4% 36.9% 39.0% 38.0% 37.7% 37.5% 38.0% 39.3%
y/y 16% 15% 24% 18% 12%

35
Valuation Table PGND
Last closing price: $31.47
Press Ganey Fair Value In 12 Months 2017E
Forward EV/Adj. EBITDA multiple 10.5x
Adj. EBITDA $154,309
Enterprise Value $1,620,246
Less debt 4Q16E $175,284
Plus cash 4Q16E $134,758
Equity value $1,579,720
Dil. shares outstanding 4Q16E 54,089
Price Target $29.21
upside (7.2%)
Press Ganey Fair Value In 12 Months 2017E
Non-GAAP EPS $1.23
Price Target $36.98
upside 17.5%
Average Price Target (12 mo.) $33.09
upside 5.2%

36
TELADOC, INC (TDOC)
(TDOC – RATING: OUTPERFORM; PRICE TARGET: $21)
INVESTMENT THESIS
• Telehealth is moving into the mainstream, seeing rapid adoption by
employers and insurers seeking ways to provide care more
efficiently and consumers seeking low cost and convenience.
• As nation’s largest provider of telehealth services, TDOC is leading
the penetration of a ~$17 billion TAM which could expand even
further if telehealth is adopted beyond acute care.
• At an estimated 60% topline 3-yr CAGR, TDOC is one of the fastest
growers in the Digital Health sector with mostly recurring
subscription revenues, strong gross margins and long-term profit
potential at scale.
COMPARATIVE STATS
• 2016E sales growth: 55% (inline with consensus)
• 74% of large employers expect to add telehealth benefit in 2016 vs.
48% in 2015*
• IPO in July 2015 at $19
Source: Company data, Leerink Partners estimates, and FactSet Research Systems, *NBGH survey 8/2015
$489
2015 2016E 2017E 2015 2016E 2017E
Consensus $77 $121 $175 5.0x 3.2x 2.2x
$121 $175
2015 2016E 2017E 2015 2016E 2017E
Consensus 13% 56% 45% ($48) ($39) ($7)
2015 2016E 2017E
Consensus ($1.53) ($1.35) ($0.54)
TDOC 10% -30% NA NA
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
Sectoral Asset Management, Inc. 975,517 2.5%
Marble Arch Investments LP 948,807 2.5%
Brow n Advisory LLC 821,060 2.1%
Wells Capital Management, Inc. 689,443 1.8%
Elk Creek Partners LLC 642,603 1.7%
Fidelity Management & Research Co. 573,310 1.5%
Peregrine Capital Management, Inc. 543,890 1.4%
T. Row e Price Associates, Inc. 519,115 1.3%
EV/Sales
Revenue Growth GAAP EBITDA
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Sales (mil)
$5.00
$7.00
$9.00
$11.00
$13.00
$15.00
$17.00
$19.00
$21.00
$23.00
$25.00

Teladoc (TDOC)
Revenue 19,906 43,528 77,384 26,888 28,294 29,485 35,476 120,143 173,515
q/q 18.8% 5.2% 4.2% 20.3%
y/y 118.7% 77.8% 63.1% 54.8% 47.6% 56.7% 55.3% 44.4%
Cost of revenue: 4,186 9,929 21,041 7,943 8,064 7,076 10,288 33,371 49,443
% of revenue 21.0% 22.8% 27.2% 29.5% 28.5% 24.0% 29.0% 27.8% 28.5%
Gross profit 15,720 33,599 56,343 18,945 20,230 22,409 25,188 86,771 124,071
% margin 79.0% 77.2% 72.8% 70.5% 71.5% 76.0% 71.0% 72.2% 71.5%
Advertising and marketing 4,090 7,662 20,236 8,050 7,922 7,371 7,450 30,793 32,884
% of revenue 20.5% 17.6% 26.2% 29.9% 28.0% 25.0% 21.0% 25.6% 19.0%
y/y 87% 164% 52% 7%
Sales expenses 4,441 11,571 17,976 5,270 5,376 5,897 5,321 21,864 26,996
% of revenue 22.3% 26.6% 23.2% 19.6% 19.0% 20.0% 15.0% 18.2% 15.6%
y/y 161% 55% 22% 23%
Technology and development 3,532 7,573 14,210 5,225 5,376 4,423 4,612 19,635 20,822
% of revenue 17.7% 17.4% 18.4% 19.4% 19.0% 15.0% 13.0% 16.3% 12.0%
y/y 114% 88% 38% 6%
% of revenue 44.1% 45.1% 70.9% 50.6% 51.0% 50.0% 43.0% 48.3% 34.1%
y/y 124% 179% 6% 2%
EBITDA (5,115) (12,830) (50,922) (13,207) (12,874) (10,025) (7,450) (43,555) (15,853)
% margin (25.7%) (29.5%) (65.8%) (49.1%) (45.5%) (34.0%) (21.0%) (36.3%) (9.1%)
Stock based compensation 533 3,075 1,288 1,800 2,000 2,200 7,288 10,000
Adjusted EBITDA (12,297) (47,847) (11,919) (11,074) (8,025) (5,250) (36,267) (5,853)
Depreciation and amortization 754 2320 4,863 1,508 1,600 1,600 1,600 6,308 6,700
Total operating expenses 21,589 48,749 112,128 33,660 34,704 34,034 34,238 136,635 146,624
y/y 126% 130% 22% 7%
Income (loss) from operations (5,869) (15,150) (55,785) (14,715) (14,474) (11,625) (9,050) (49,863) (22,553)
% margin -29.5% -34.8% -72.1% 54.7%) 51.2%) 39.4%) 25.5%) -41.5% -13.0%
Interest income (expense) (56) (1,499) (2,199) (427) (427) (427) (427) (1,708) (1,708)
Pre-tax Income (loss) (5,925) (16,649) (57,984) (15,142) (14,901) (12,052) (9,477) (51,571) (24,261)
Income tax (benefit) provision 94 388 36 162 671 - - 833 -
Tax rate (1.6%) (2.3%) (0.1%) -1.1% -4.5% 0.0% 0.0% (1.6%) 0.0%
GAAP Net Income (loss) (6,019) (17,037) (58,020) (15,304) (15,571) (12,052) (9,477) (52,404) (24,261)
Preferred stock dividend (3,821) (3,088) - - - - - - -
GAAP Net Income (loss) available to common (9,840) (20,125) (58,020) (15,304) (15,571) (12,052) (9,477) (52,404) (24,261)
Basic EPS - GAAP ($8.05) ($10.25) ($2.91) ($0.40) ($0.40) ($0.31) ($0.24) ($1.35) ($0.61)
Diluted EPS - GAAP ($8.05) ($10.25) ($2.91) ($0.40) ($0.40) ($0.31) ($0.24) ($1.35) ($0.61)
GAAP weighted-average shares:
Basic 1,222,268 1,962,845 19,917,348 38,584,345 38,746,399 38,940,131 39,134,832 38,851,427 39,626,469
Diluted 1,222,268 1,962,845 19,917,348 38,584,345 38,746,399 38,940,131 39,134,832 38,851,427 39,626,469
37

38
Teladoc (TDOC)
Revenue Build Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
in thousands FY2013A FY2014A 1Q:15A 2Q:15A 3Q:15A 4Q:15A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E 1Q:17E 2Q:17E 3Q:17E 4Q:17E FY2017E
Subscription fees revenue $13,190 $15,100 $17,000 $18,000 $63,290 $20,700 $23,334 $24,508 $27,761 $96,303 $31,323 $32,262 $34,198 $37,276 $135,059
q/q NA 14% 13% 6% 15% 13% 5% 13% 13% 3% 6% 9%
y/y NA 70% 78% 71% 57% 55% 44% 54% 52% 51% 38% 40% 34% 40%
% of total 80% 83% 85% 80% 82% 77% 82% 83% 78% 80% 76% 79% 81% 76% 78%
Visit fees revenue $3,298 $3,183 $2,973 $4,640 $14,094 $6,188 $4,960 $4,977 $7,715 $23,840 $9,798 $8,426 $8,258 $11,974 $38,456
q/q NA -3% -7% 56% 33% -20% 0% 55% 27% -14% -2% 45%
y/y NA 127% 122% 94% 88% 56% 67% 66% 69% 58% 70% 66% 55% 61%
% of total 20% 17% 15% 20% 18% 23% 18% 17% 22% 20% 24% 21% 19% 24% 22%
Total revenue $19,906 $43,528 $16,488 $18,283 $19,973 $22,640 $77,250 $26,888 $28,294 $29,485 $35,476 $120,143 $41,121 $40,689 $42,456 $49,250 $173,515
q/q 28% 11% 9% 13% 19% 5% 4% 20% 16% -1% 4% 16%
y/y 119% 75% 78% 83% 75% 77% 63% 55% 48% 57% 56% 53% 44% 44% 39% 44%
Revenue Metrics:
Members (000) 6,200 7,667 10,600 11,500 12,600 12,200 12,200 15,100 15,402 16,018 17,460 17,460 20,079 20,681 21,922 23,895 23,895
q/q 31% 8% 10% -3% 24% 2% 4% 9% 15% 3% 6% 9%
y/y 24% 49% 47% 56% 51% 59% 42% 34% 27% 43% 43% 33% 34% 37% 37% 37%
Avg implied PMPM fee $0.00 $0.41 $0.44 $0.45 $0.49 $0.450 $0.46 $0.51 $0.51 $0.53 $0.502 $0.52 $0.52 $0.52 $0.52 $0.52
Visits (000) 127.1 298.8 148.7 125.3 117.2 184.3 575.5 239.9 187.2 184.3 285.7 897.2 362.9 312.1 305.8 443.5 1,424.3
q/q 35% -16% -6% 57% 30% -22% -2% 55% 27% -14% -2% 45%
y/y 135% 128% 104% 89% NA 93% 61% 49% 57% 55% 56% 51% 67% 66% 55% 59%
Avg implied visit fee $0.00 $0.00 $22.18 $25.40 $25.36 $25.18 $24.49 $25.79 $26.50 $27.00 $27.00 $26.57 $27.00 $27.00 $27.00 $27.00 $27.00
Qly engagement (qtly visits/members) 1.4% 1.1% 0.9% 1.5% - 1.6% 1.2% 1.2% 1.6% - 1.8% 1.5% 1.4% 1.9% -
Ann. engagement (ann. visits/members) 4.7% 5.1% 6.0%
Other Data:
certified physicians in network 1,350+ 2,650
US telehealth visits (000) 250 415 800 1,240
y/y 66% 93% 55%
Teladoc implied mkt share 51% 72% 72% 72%
Headcount 407 537 600+ 600+
Total Clients 6000+ 6000+
Fortune 1000 Clients 200+ 200+
Hospitals and Health Systems 60+ 60+
Health Plan Clients 26 26

39
VEEVA SYSTEMS, INC. (VEEV)
(VEEV – RATING: MARKET PERFORM; PRICE TARGET: $32)
INVESTMENT THESIS
• The life-sciences industry lags other sectors in cloud adoption
across productivity systems, but Veeva represents a strong cloud-
based entrant achieving near 50% market share in the large US
pharma Customer Relationship Management (CRM) market.
• Veeva is pursuing growth through new cloud-based productivity
products in the life sciences industry and global expansion.
• Veeva’s life-sciences industry knowledge helps it build specialized
solutions and serves as a barrier to entry to other cloud
competitors.
COMPARATIVE STATS
• CY16/FY17E Sales growth: 27% (inline with consensus)
$15.00
$20.00
$25.00
$30.00
$35.00
$40.00
$45.00
$50.00
$5,023
CY2015 CY2016E CY2017E CY2015 CY2016E CY2017E
Consensus $409 $519 $629 10.6x 8.3x 6.9x
$409 $519 $629
CY2015 CY2016E CY2017E CY2015 CY2016E CY2017E
Consensus 65% 27% 21% $105 $139 $176
CY2015 CY2016E CY2017E
Consensus $0.51 $0.57 $0.73
VEEV 7% 22% 34% N/a
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
T. Row e Price Associates, Inc. 11,317,018 11.7%
Brow n Capital Management LLC 7,246,956 7.5%
JPMorgan Investment Management, Inc. 5,159,670 5.3%
Wells Capital Management, Inc. 4,300,370 4.4%
Federated Global Investment Management Corp. 3,892,977 4.0%
BlackRock Advisors LLC 2,814,981 2.9%
First Trust Advisors LP 2,302,111 2.4%
EV/Sales
Price on 06/08/16
52-Week High
52-Week Low
Market Cap (mil)
Sales (mil)

40
Veeva Systems Inc. (VEEV)
Income Statement for FYE January, Non-GAAP CY2013A CY2014A CY2015E Apr-16 Jul-16 Oct-16 Jan-17 CY2016E CY2017E
($MM) FY2014A FY2015A FY2016A 1Q:17A 2Q:17E 3Q:17E 4Q:17E FY2017E FY2018E
Revenues:
Subscription services 146.6 233.1 316.3 96.0 99.9 107.2 113.8 416.9 517.0
Growth % y/y 100.1% 59.0% 35.7% 39.4% 22.0% 22.0% 21.0% 31.8% 24.0%
% of revenue 69.8% 74.4% 77.3% 80.2% 80.1% 79.7% 81.6% 80.4% 82.9%
Professional services and other 63.5 80.2 92.9 23.7 24.9 27.3 25.6 101.5 106.6
Growth % y/y 12.9% 26.2% 15.9% 12.9% 5.0% 5.0% 5.0% 9.2% 5.0%
% of revenue 30.2% 25.6% 22.7% 19.8% 19.9% 20.3% 18.4% 19.6% 17.1%
Total Revenue $210.2 $313.2 $409.2 $119.8 $124.8 $134.4 $139.4 $518.4 $623.5
Growth % y/y 62.2% 49.0% 30.6% 33.2% 27.2% 25.7% 22.0% 26.7% 20.3%
Cost of Revenues: 23% 24% 26% 27%
Cost of subscription services 34.7 52.4 67.1 20.3 18.3 19.2 19.6 77.3 73.4
Cost of professional services and other 45.5 58.4 67.2 18.2 19.7 20.6 21.1 79.6 79.1
Total Cost of Revenue 80.2 110.8 134.3 38.4 38.0 39.8 40.7 156.9 152.5
% growth y/y 40.9% 38.2% 21.1% 25.7% 20.2% 14.2% 9.3% 16.9% (2.8%)
% of revenue 38.1% 35.4% 32.8% 32.1% 30.4% 29.6% 29.2% 30.3% 24.5%
Non-GAAP Gross Profit:
Subscription services Gross Profit 112.0 180.6 249.2 75.8 79.0 84.8 90.2 329.7 408.8
% margin 76.4% 77.5% 78.8% 78.9% 79.0% 79.1% 79.3% 79.1% 79.1%
Professional services and other Gross Profit 18.0 21.8 25.7 5.6 6.0 6.8 5.9 24.3 26.6
% magin 28.4% 27.2% 27.7% 23.5% 24.0% 25.0% 23.0% 23.9% 25.0%
Gross Profit (Non-GAAP) 130.0 202.4 275.0 81.3 84.9 91.6 96.1 354.0 435.4
Growth % y/y 78.9% 55.7% 35.9% 37.1% 27.7% 27.1% 24.7% 28.7% 23.0%
% gross margin 61.9% 64.6% 67.2% 67.9% 68.0% 68.1% 69.0% 68.3% 69.8%
Operating Expenses:
Research and development 25.7 37.7 59.1 19.7 20.5 21.5 21.6 83.4 93.5
% of revenue 12.3% 12.0% 14.4% 16.5% 16.5% 16.0% 15.5% 16.1% 15.0%
15.0%Sales and marketing 39.6 52.8 72.6 23.3 25.0 25.5 27.9 101.7 113.9
% of revenue 18.9% 16.9% 17.7% 19.5% 20.0% 19.0% 20.0% 19.6% 18.3%
% of revenue 8.6% 8.1% 8.6% 7.4% 7.5% 7.6% 7.7% 7.6% 7.2%
Growth % y/y 97.5% 39.3% 43.6% 57.0% 45.0% 30.4% 16.1% 34.6% 12.6%
% of revenue 39.7% 37.1% 40.7% 43.3% 44.0% 42.6% 43.2% 43.3% 40.5%
Operating Income (Non-GAAP) 46.7 86.3 108.3 29.5 30.1 34.3 35.9 129.7 182.8
% operating margin 22.2% 27.6% 26.5% 24.6% 24.1% 25.5% 25.8% 25.0% 29.3%
EBITDA (Non-GAAP) 47.7 85.5 104.9 28.3 30.9 35.2 36.8 131.1 186.2
Other income (expense), net (0.8) (2.8) 0.0 2.7 0.0 0.0 0.0 2.7 0.0
Pre-tax Income (loss) (Non-GAAP) 45.9 83.6 108.3 32.2 30.1 34.3 35.9 132.5 182.8
Provision for income taxes 15.7 30.4 34.2 11.0 11.1 12.7 13.3 48.1 67.6
Tax rate 34.3% 36.3% 31.5% 34.2% 37.0% 37.0% 37.0% 36.3% 37.0%
Net Income (Non-GAAP) 30.1 53.2 74.2 21.2 18.9 21.6 22.6 84.3 115.2
% growth y/y 56.2% 76.6% 39.4% 23.5% 4.2% 27.9% 3.1% 13.7% 36.5%
Non-GAAP EPS - Diluted $0.23 $0.37 $0.51 $0.15 $0.13 $0.15 $0.15 $0.57 $0.75
% growth y/y 45.6% 58.6% 38.4% 22.6% 2.5% 24.7% (0.3%) 11.4% 32.3%
Basic shares 51.1 127.7 132.1 134.0 135.5 137.0 138.5 136.2 141.0
Diluted shares 129.3 143.8 145.0 145.7 147.2 148.7 150.2 148.0 152.7

41
Valuation Table VEEV
Last closing price: $29.76
VEEV Fair Value In 12 Months FY18E
Non-GAAP EPS $0.75
Price Target $31.67
upside 6.4%

42
WAGEWORKS, INC. (WAGE)
(WAGE – RATING: OUTPERFORM; PRICE TARGET: $59)
INVESTMENT THESIS
• We believe that there will be strong healthcare cost-shifting by
employers onto employees in 2016 across the board.
• In our view, this shift will directly benefit the Consumer-Directed-
Benefits sector in general and WageWorks in particular.
• MEDACorp channel check finds CDB is important to bundle with
cost shifting.
COMPARATIVE STATS
• 2016E Sales growth: 10% (above consensus at 8%)
• Remains within on year trading range
$5.00
$15.00
$25.00
$35.00
$45.00
$55.00
$65.00
$75.00
$2,146
2015 2016E 2017E 2015 2016E 2017E
Consensus $334 $362 $403 5.0x 4.6x 4.2x
$362 $403
2015 2016E 2017E 2015 2016E 2017E
Consensus 22% 8% 11% $97 $110 $129
2015 2016E 2017E
Consensus $1.26 $1.41 $1.67
$1.41 $1.67
WAGE 6% 31% 37% N/a
S&P 500 Healthcare 1.7% 0.4% -2.0% 49.2%
NASDAQ Biotech -0.4% -17.7% -23.1% 55.7%
TimesSquare Capital Management LLC 2,394,935 6.6%
D. F. Dent & Co., Inc. 2,060,514 5.7%
Ranger Investment Management LP 1,151,091 3.2%
Stephens Investment Management Group LLC 827,177 2.3%
Wells Capital Management, Inc. 683,336 1.9%
SSgA Funds Management, Inc. 676,089 1.9%
52-Week High
Price on 06/08/16
52-Week Low
Market Cap (mil)

43
WageWorks, Inc. (WAGE)
Income Statement for FYE December, Non-GAAP Mar-16 Jun-16 Sep-16 Dec-16 382.5 426.8
($MM) FY2012A FY2013A FY2014A FY2015A 1Q:16A 2Q:16E 3Q:16E 4Q:16E FY2016E FY2017E
Revenue:
Healthcare 112.9 135.1 156.0 176.6 50.4 49.9 50.2 51.5 202.0 230.3
Growth % y/y NA 19.7% 15.4% 13.2% 10.0% 14.0% 19.0% 19.0% 14.4% 14.0%
% of revenue 63.7% 61.6% 58.2% 52.8% 57.9% 55.8% 53.7% 53.6% 55.2% 55.3%
Commuter 51.8 59.6 61.8 63.9 17.4 17.6 19.0 19.0 73.1 80.4
Growth % y/y NA 15.0% 3.7% 3.4% 3.0% 10.0% 19.0% 19.0% 14.3% 10.0%
% of revenue 29.2% 27.2% 23.1% 19.1% 20.0% 19.7% 20.4% 19.8% 19.9% 19.3%
COBRA 32.0 51.3 15.4 19.0 21.0 22.2 77.7 91.8
Growth % y/y NA 60.3% 22.6% 54.3% 71.7% 56.8% 51.4% 18.2%
% of revenue 11.9% 15.3% 17.7% 21.2% 22.4% 23.2% 21.2% 22.1%
Other 12.6 20.5 18.1 42.5 3.9 3.0 3.3 3.3 13.5 13.7
Growth % y/y NA 63.3% NA 135.5% (59.6%) (71.7%) (74.1%) (65.9%) (68.4%) 2.0%
% of revenue 7.1% 9.4% 6.7% 12.7% 4.4% 3.3% 3.5% 3.4% 3.7% 3.3%
Total Revenue $177.3 $219.3 $267.8 $334.3 $87.0 $89.6 $93.6 $96.0 $366.2 $416.2
Growth % q/q 4.7% 3.0% 4.5% 2.6%
Growth % y/y NA 23.7% 22.1% 24.8% 2.0% 8.2% 12.5% 15.6% 9.5% 13.7%
Cost of revenues (ex. software amort & stock comp, non-GAAP)64.4 80.9 98.0 113.3 30.1 30.5 27.6 31.7 119.9 136.7
% of revenue 36.3% 36.9% 36.6% 33.9% 36.5% 34.0% 29.5% 33.0% 32.7% 32.9%
Gross profit (Non-GAAP) 112.9 138.3 169.8 221.0 56.9 59.1 66.0 64.3 246.3 279.5
% margin 63.7% 63.1% 63.4% 66.1% 65.4% 66.0% 70.5% 67.0% 67.3% 67.1%
Operating Expenses (ex. Stock comp):
Technology and development 18.5 20.6 26.5 41.9 9.3 12.1 12.6 11.5 45.6 49.9
% of revenue 10.5% 9.4% 9.9% 12.5% 12.5% 13.5% 13.5% 12.0% 12.5% 12.0%
Sales and marketing 29.9 33.6 42.5 47.8 13.2 12.5 13.1 13.0 51.8 52.0
% of revenue 16.8% 15.3% 15.9% 14.3% 14.0% 14.0% 14.0% 13.5% 14.2% 12.5%
General and administrative 26.2 31.3 34.2 41.2 11.0 10.7 11.2 11.0 44.0 47.9
% of revenue 14.8% 14.3% 12.8% 12.3% 12.0% 12.0% 12.0% 11.5% 12.0% 11.5%
Total operating expenses 74.6 85.5 103.2 130.9 33.5 35.4 37.0 35.5 141.4 149.8
y/y 20.7% 26.8% 8.0% 6.0%
Non-GAAP amortization 6.7 7.9 8.7 11.7 3.1 3.6 3.8 4.2 14.7 18.3
Operating Income (Non-GAAP) $31.6 $44.8 $57.9 $78.4 $20.2 $20.1 $25.2 $24.6 $90.2 $111.3
% margin 17.8% 20.4% 21.6% 23.5% 23.2% 22.5% 26.9% 25.6% 24.6% 26.8%
EBITDA (Non-GAAP) $41.4 $56.5 $71.7 $96.6 $25.1 $25.5 $30.8 $30.7 $112.2 $137.9
Growth % y/y NA 37% 27% 35% 25% 25% 25% 25% 16% 23%
% margin 23.3% 25.7% 26.8% 28.9% 28.9% 28.5% 32.9% 32.0% 30.6% 33.1%
Interest income 0.0 0.0 0.0 0.2 0.1 0.1 0.1 0.1 0.3 0.1
Interest expense (1.8) (1.3) (1.6) (1.9) (0.4) (0.4) (0.4) (0.4) (1.6) (1.6)
Other income 0.0 0.2 0.7 (0.2) (0.0) 0.0 0.0 0.0 (0.0) 0.0
Pre-tax Income (loss) (Non-GAAP) 29.9 43.7 57.0 76.5 19.9 19.8 24.9 24.3 88.8 109.8
Income tax provision (12.2) (17.5) (22.5) (30.3) (8.0) (7.9) (9.9) (9.7) (35.6) (43.9)
Tax rate 40.9% 40.0% 39.2% 39.7% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%
Non-GAAP Net Income to common $17.4 $26.2 $34.5 $46.1 $11.9 $11.9 $14.9 $14.6 $53.3 $65.9
Non-GAAP EPS - Diluted $0.58 $0.74 $0.95 $1.26 $0.33 $0.32 $0.40 $0.39 $1.45 $1.76
% growth NA 28.1% 27.8% 32.5% 13.6% 15.3% 12.5% 18.4% 15.0% 21.9%
GAAP Net Income to common $7.9 $21.6 $18.2 $23.2 $5.8 $5.7 $8.8 $8.4 $28.8 $43.7
GAAP EPS - Diluted $0.33 $0.62 $0.50 $0.63 $0.16 $0.16 $0.24 $0.23 $0.78 $1.17
Diluted shares pro forma 30.0 35.3 36.3 36.6 36.5 36.6 36.9 37.1 36.8 37.4

Steve wardell Digital Health Marketing Deck

Steve wardell Digital Health Marketing Deck

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to Steve wardell Digital Health Marketing Deck

Similar to Steve wardell Digital Health Marketing Deck (20)

More from Steven Wardell

More from Steven Wardell (20)

Recently uploaded

Recently uploaded (20)

Steve wardell Digital Health Marketing Deck