Progyny Shares Drop 6% After Conservative Third Quarter Guidance

Progyny shares declined 6% on Friday following the release of second-quarter earnings. The market reaction followed management's conservative guidance for the third quarter, which projected sales growth of only 7% to 11% and a slight sequential dip in earnings.

Despite the stock drop, the company reported a 5% increase in sales and a 15% jump in adjusted earnings per share, both of which exceeded Wall Street expectations. Other positive indicators included a 7% increase in average covered members to 7.2 million and an 180 basis point expansion in gross profit margins.

To stimulate future growth, the company is expanding its target market. Progyny is moving beyond large corporations to target smaller firms with 100 or more employees through its Progyny Select pooled risk model, which provides fertility and women's health solutions at a fixed price.