What Does Progyny’s Falling Multiple Really Say?
For questions about this article or underlying research, email help@trefis.com.
A simple rule applies to reading a stock like Progyny (PGNY): the lower its price-to-earnings multiple, or what you pay for each dollar of profit, the cheaper the stock. Progyny’s multiple was 75.6 in mid-2023, and it stood at 28.4 at the latest close. Is Progyny stock cheaper than it was three years ago?
Progyny Stock Fell, But Its Multiple Fell Much More
Progyny’s shares lost 27.4% over those three years, while the multiple fell by more than half. The lower share price accounts for only part of that drop in the multiple. Higher profit and buybacks made up the rest, with buybacks cutting Progyny’s diluted share count from 101 million to 82.1 million over the three years.
How Much Has Progyny’s Profit Grown?
Progyny recorded a profit of $78.6 million over the latest twelve months, compared with $49.3 million three years earlier. That makes the recent figure 1.6 times as large.
| Twelve months to | Net income | Change in a year | Price-to-earnings |
|---|---|---|---|
| Jun 30, 2021 | $77.8 million | not meaningful (loss a year earlier) | 66.9 |
| Jun 30, 2022 | $45.6 million | -41.4% | 58.6 |
| Jun 30, 2023 | $49.3 million | +8.1% | 75.6 |
| Jun 30, 2024 | $62.8 million | +27.3% | 42.8 |
| Jun 30, 2025 | $53.1 million | -15.3% | 35.5 |
| Jun 30, 2026 | $78.6 million | +48% | 28.7 |
| Jun 30, 2026 (at the share price of Oct 20, 2026) | $78.6 million | +48% | 28.4 |
Net income is the reported total for the twelve months ending on the date shown. Change in a year is that net income against the twelve months before. Each price-to-earnings multiple is the market value at the calendar quarter end paired with those twelve months, over that net income; the last row uses the share price of Oct 20, 2026.
Progyny sells women’s health and family building solutions to employers. Fertility benefits services generated 64.5% of revenue in fiscal 2025, with pharmacy benefits services bringing in the rest. Management said on the August 6 call that second-quarter gross margin expanded 180 basis points from a year earlier, so the business is keeping more of each sales dollar.
Does A Lower Multiple Make Progyny Cheaper?
Partly. A buyer today pays less for each dollar of profit, but the reasons matter more than the rule suggests.
A better question is what investors were paying for when the multiple was high, and how much of it has since arrived. Over the past five years, Progyny’s multiple peaked at 95.5 at the end of 2022. Profit today is about 2.6 times what it was then.
Investors paid the most for each dollar of profit when the company generated far less of it. Profit did grow after that point, yet a buyer in mid-2023 at a multiple of 75.6 still saw the shares fall 27.4%. A buyer today does pay less for each dollar of profit than a buyer in mid-2023 did. That earlier buyer, however, was paying for growth that has since shown up in the profit. A growing company’s multiple tends to fall as its profit catches up, but the pattern only goes so far here. In mid-2021, Progyny earned $77.8 million, close to today’s $78.6 million, at a multiple of 66.9. So part of the lower multiple reflects investors paying less for about the same profit.
Where Is Progyny On That Curve Now?
Progyny’s profit has bounced back. It rose 48.0% in the latest twelve months after falling 15.3% the year before, and now sits about 25% above its level two years earlier. Profit also grew far faster than sales, which rose 5.5%.
Progyny’s multiple today remains above the S&P 500’s 23.0. The figure to watch is how fast Progyny’s profit grows from here against the latest year’s pace. The company is expected to report next on or around October 29.
How To Act On PGNY?
Not necessarily on Progyny alone, if your goal is long-term wealth. Wealth is built by owning the companies that keep outperforming, the leaders of their industries, wherever they are. Here are two companies from Progyny’s own industry that have beaten it. Over the five years to October 2026, Cigna stock rose 57% and RadNet stock rose 134%, while Progyny stock fell 52%.
Finding companies like these takes comparison across industries and sectors, and that is what the Trefis High Quality (HQ) Portfolio does. It holds 30 quality companies in equal weight and, since its inception in September 2020, has returned more than 105%, ahead of a benchmark that combines the S&P 500, S&P Mid-cap and Russell 2000. See how we find the leaders.
Spot an error or want more like this? Tell us in 10 seconds.