HealthEquity (HQY) as of January 31, 2026 presents a balance sheet that is dominated by intangible assets and goodwill, generating a deeply negative liquidation recovery to equity under standard haircut assumptions. Total assets are $3.38B, of which goodwill is $1.65B (49% of total assets) and finite-lived intangibles net are $1.10B (32%). Both carry zero recovery under the liquidation lens, collectively wiping out approximately $2.75B of the asset base. Tangible assets with recovery value are modest: cash $319M (100% recovery ~$319M), net AR $124M (90-95% recovery ~$113M), and net PP&E $3.2M (50-70% recovery ~$2M). Operating lease ROU assets ($36M) carry negligible recovery as the underlying leases remain obligations. Total liability stack at face value is $1.27B, comprising current liabilities of $157M and noncurrent of $1.12B. The dominant liability is long-term debt of $957M (carrying value net of issuance costs), comprised of $600M in 4.50% Senior Notes due 2029 and $362M drawn on the $1.0B revolving credit facility maturing August 2029. The filing discloses the Notes' fair value at $587M as of the period end, but under liquidation the obligation stays at face ($600M). Operating lease commitments total $49M undiscounted ($44M present value on balance sheet), remaining as face-value obligations. Contractual obligations in XBRL total $1.31B, with $1.0B concentrated in year four (consistent with the revolver maturity and notes maturity timeline). The MFFAIS-reported cash liquidation value is negative $829M, liquid liquidation value is negative $706M. These figures are consistent with the intangible-heavy asset structure described above. The company initiated $2.35B notional in Treasury bond forward cash flow hedges during fiscal 2026 (new program, no derivatives held at January 31, 2025), with a net derivative liability position of approximately $11.6M gross ($6.9M current, $8.0M long-term, partially offset by $3.3M long-term asset). This is immaterial to recovery but represents a new liability category. Net deferred tax liability widened to $93.7M from $55.8M, driven by a sharp reduction in the capitalized R&D deferred tax asset ($18.8M from $53.2M), partially offset by an increase in the goodwill deferred tax liability ($45.7M from $38.2M). The company repurchased $302M of common stock during fiscal 2026 (3.25M shares), funded by operating cash flow ($457M) and partially debt-funded. Retained earnings at period end are $196M. No goodwill impairment was recorded. The filing does not separately XBRL-tag custodial HSA assets held off-balance-sheet ($34B+), which are the operational foundation of the business but would not appear in a balance-sheet liquidation.
▼ Community Notes