Nelson Advisors: Will more Digital MSK companies IPO after Hinge Health's share price more than trebled in 2026?
A $32 stock is now a $107 stock
Seventeen months after it listed at $32 a share, Hinge Health traded as high as $107.44 on 20th October 2026, valuing the company at roughly $8.7 billion. That is about x3.3 times the IPO price and more than three times the $2.6 billion the company was worth on the day it priced. For a digital health IPO, that is not just a good outcome. It is close to the best outcome the sector has produced since the 2020–2021 window closed.
The question this raises is obvious. Digital musculoskeletal (MSK) care was one of the most crowded categories in digital health for the better part of a decade. Hinge, Sword Health, Kaia Health, Omada and a long tail of smaller players all raised money on the same pitch: back, joint and muscle pain is a top-three line item in employer health spend, most of it is treatable without surgery or opioids, and a sensor-guided exercise programme with a remote physical therapist can deliver the outcome at a fraction of the cost. Hinge was the first to prove that pitch to public investors. Does its re-rating mean the rest will follow?
The honest answer is that the window is more open than it has been at any point since 2021, but the list of companies that can actually walk through it is short. Hinge's valuation is not a reward for being a digital MSK company. It is a reward for being a profitable, cash-generating one with 50% growth, and almost nobody else in the category can show that yet.
This post walks through what Hinge actually delivered, why the market changed its mind between February and October, how the one comparable listing (Omada) has fared, and which private companies are realistic candidates for the next 12–24 months.
What Hinge actually delivered
Hinge's first full year as a public company produced $587.9 million of revenue, up 51% on 2024, and $119.5 million of non-GAAP income from operations, a 20% margin. The year before, on the same non-GAAP basis, it lost $26.1 million. That swing from loss to a 20% margin on 51% growth is the number the market is paying for.
Metric | FY2024 (pre-IPO) | FY2025 | FY2026 guidance |
Revenue | $390.4M | $587.9M (+51%) | $732–742M (~+25%) |
Non-GAAP income from operations | –$26.1M | $119.5M (20% margin) | $151–156M (~21% margin) |
GAAP income (loss) from operations | –$31.9M | –$546.4M | — |
Free cash flow | — | $180M (31% margin) | — |
Year-end cash | — | $479M | — |
The GAAP line looks alarming and is mostly noise. Q2 2025 alone carried $591 million of stock-based compensation expense, triggered by RSUs that vested on listing. Strip that out and the operating business was comfortably profitable all year. The cash statement tells the cleaner story: $180 million of free cash flow in 2025, a 31% margin, and $479 million in the bank at year end. Third-party data providers that compute a GAAP-based EBITDA show roughly –$541 million for FY2025, which is simply the IPO charge again; trailing-twelve-month EBITDA has since recovered to around $98 million as those quarters rolled off.
The first half of 2026 is tracking ahead of the guidance the company gave in February. Revenue was $182.3 million in Q1 and $212.8 million in Q2, taking trailing-twelve-month revenue to $720 million. If the second half holds that trajectory, Hinge will finish 2026 at or above the top of its $732–742 million range. Q3 results are due in early November.
Two things about this profile matter for the IPO question. First, Hinge's growth is now decelerating from 51% to the mid-20s, and the stock has re-rated anyway, which tells you investors are paying for durability of margin rather than for growth alone. Second, the margin structure is a function of scale: a fixed base of physical therapists, sensors and enrolment infrastructure spread over an employer book that now covers tens of millions of eligible lives. A competitor at a third of Hinge's revenue does not get a third of Hinge's margin. It gets a fraction of it, or none.
Why the market changed its mind
The stock's path was not a straight line, and the detour matters for anyone reading the current price as a verdict on the whole category. Hinge priced at $32, popped on day one, drifted through the mid-$40s in late 2025 and opened 2026 at $45.56. Then it fell. After Q4 results in February the shares sank to an all-time low of $30.08 on 9 February 2026, below the IPO price, as investors digested guidance that growth would halve from 51% to roughly 25%.
Point in time | Share price | Market cap |
IPO, 22 May 2025 | $32 | ~$2.6B |
Open of 2026 | $45.56 | ~$3.7B |
52-week low, 9 Feb 2026 | $30.08 | ~$2.45B |
20 Oct 2026 | ~$107 | ~$8.6–8.7B |
What changed between February and October 2026 was not the growth rate, which is still decelerating. It was the market's confidence that the margin was real and durable. Two quarters of revenue ahead of guidance, a 31% free-cash-flow margin, the IPO-era stock compensation falling out of the trailing numbers, and a half-billion-dollar cash pile with no debt gave investors a company that looked less like a venture-backed growth story and more like a healthcare services compounder.
The multiple followed: at $8.7 billion on $720 million of trailing revenue, Hinge trades at around 12x sales, a premium that a year ago nobody would have paid for a digital health name.
That is the first lesson for would-be IPO candidates. The window Hinge opened is a window for profitable companies. The February sell-off showed that public investors will punish a deceleration hard when they are not yet sure the earnings are sustainable, and will reward it just as hard once they are.
The other data point: Omada Health
Hinge is not the only test case. Omada Health listed on Nasdaq on 6 June 2025, two weeks after Hinge, pricing at $19 and avoiding the down-round that Hinge itself had accepted. Omada is a chronic-condition platform (diabetes prevention, hypertension, GLP-1 companion care) with MSK as one line of business rather than the whole company, but it is the closest public comparable and it is the one that IPO bankers will put on the next slide.
Its trading history is far less flattering. Over the past twelve months the stock has ranged from $10.28 to $28.40. It fell as low as $12.92 in March 2026 and $15.55 in May, and as of mid-October 2026 trades around $21–22, giving a market cap of roughly $1.27 billion. That is about 15% above the IPO price after seventeen months, against Hinge's 230%.
Metric | Omada (OMDA) | Hinge (HNGE) |
IPO date and price | 6 Jun 2025, $19 | 22 May 2025, $32 |
Price, mid-Oct 2026 | ~$21.76 | ~$107 |
Market cap | ~$1.27B | ~$8.7B |
Trailing-12-month revenue | ~$310M | ~$720M |
Latest quarter revenue | $87.8M (Q2 2026) | $212.8M (Q2 2026) |
TTM EBITDA | ~$13M | ~$98M |
Price / sales (TTM) | ~4x | ~12x |
The gap is instructive. Omada is growing (Q2 2026 revenue of $87.8 million was up about 43% year on year) and is roughly break-even, with $4 million of trailing net income and about $13 million of EBITDA. But it is not throwing off cash the way Hinge is, and its margin story is still being told. The market has priced that difference at an 8-turn gap in revenue multiple.
For a private MSK company weighing an IPO, Omada is the more realistic template. A listing at a modest valuation, a volatile first year and a slow grind towards a re-rating is what most digital health IPOs look like. Hinge is the exception that makes the headlines.
The obvious candidate: Sword Health
If any digital MSK company IPOs next, it is Sword Health, and its founder has spent the past eighteen months telling everyone it will not be soon. In June 2025, a month after Hinge listed, Sword raised $40 million at a $4 billion valuationfrom General Catalyst and told TechCrunch that its IPO would be "much later than everyone expects", with 2028 the earliest realistic date. At the time the company was cash-flow positive on roughly a $240 million annual revenue run rate, which would put it at about 40% of Hinge's scale then.
CEO Virgílio Bento's reasoning was explicit. He wants proof points at scale across several care verticals before facing public markets, not just MSK. He also argued that the traditional reasons for listing no longer apply: private capital is available to good companies in any size, and secondary tender offers handle employee liquidity. Sword ran a tender offer in mid-2025 and has said it expects to keep raising privately, with Bento even predicting a $50 million round at $5 billion as the next step.
What Sword has done since makes the 2028 timeline look more, not less, credible. In January 2026 it bought Kaia Health for $285 million, absorbing its US MSK clients onto Sword's platform and inheriting Kaia's reimbursement pathway in Germany. In September 2026 it signed an all-cash deal of up to $300 million for Headspace, the mental health app once valued at $3 billion, with closing expected at the start of Q4. Reports around the Kaia deal said Sword was planning a further raise of around $500 million to fund more M&A.
Read that sequence and the strategy is clear. Sword is assembling a multi-condition platform (MSK, pelvic health, cardiometabolic, now mental health) so that when it does file, the S-1 describes a diversified employer-health company rather than a single-category Hinge competitor. That is a bet that a broader story earns a higher multiple. It is also a bet that integrating two acquisitions worth nearly $600 million will go smoothly, which is exactly the kind of execution risk that public investors would rather see resolved before they buy.
Hinge's re-rating helps Sword in one concrete way: it sets a public comparable at 12x revenue. If Sword can show $400–500 million of revenue with Hinge-like margins by 2028, that comparable supports a valuation well above its last private mark. But it also raises the bar. A Sword that lists with Omada-like economics will get an Omada-like multiple, and the whole point of waiting is to avoid that outcome.
The rest of the field is being bought, not listed
Below Hinge and Sword, the digital MSK category has already consolidated to the point where there are very few independent companies of IPO scale left. Kaia Health, the third-largest pure MSK player and the only one with a serious European reimbursement footprint, is now part of Sword. That removed from the list the one company that might plausibly have attempted a European listing.
The remaining names fall into three groups, none of which look like near-term IPO candidates:
Venture-backed independents at sub-$100 million revenue: Vori Health, RecoveryOne and a handful of regional players. Each is a credible business, but none has disclosed the scale or margin profile that the Hinge re-rating has shown public investors now demand. The realistic exit for this group is a sale to a larger platform, a health plan or a traditional MSK provider.
MSK as a module inside a broader platform: Omada, Teladoc, Virgin Pulse (Personify Health) and the navigation vendors all sell an MSK programme, often white-labelled or built in-house. These are not MSK IPO candidates because MSK is not the company.
Incumbent providers going digital: physical therapy chains and orthopaedic groups, many of them private-equity owned, that have added remote monitoring and virtual PT. Their exits run through PE sponsors and strategic buyers, not the IPO market.
There is a structural reason the field has thinned.
Digital MSK is a business where the economics improve sharply with scale and where distribution is concentrated in a small number of national health plans, benefits consultants and large employers. Hinge's own filings cite tens of millions of contracted lives and relationships with every major national plan.
A new entrant cannot replicate that in a venture-funded time frame, which is why the category has resolved into a two-horse race plus a long tail, and why the long tail is being acquired at valuations that look modest next to Hinge's $8.7 billion. Kaia at $285 million and Headspace at up to $300 million, both once multi-billion-dollar private companies, are the price signals that matter for the long tail.
So the answer to "will more digital MSK companies IPO" is, for most of the sector, no, because they will not exist as independent companies long enough to try.
The case for more IPOs
The bull case for a second wave is real, and it rests on four things Hinge has changed.
There is now a public multiple. Before May 2025, a digital MSK company pitching an IPO had to argue by analogy to Teladoc, Omada or the 2021 cohort, none of which was flattering. Today there is a pure-play comparable trading at roughly 12x trailing revenue and 70x trailing non-GAAP operating income. Bankers can anchor to it, and private boards can measure themselves against it.
The investor base has been rebuilt. Hinge's rally from $30 to $107 did not happen on retail enthusiasm. It happened because healthcare-services and growth funds that had written off digital health after 2022 came back, did the work, and concluded that the employer-benefits model can produce 20%-plus operating margins at scale. Those funds now have an allocation to the category and a reason to look at the next name.
The playbook is proven. Hinge's FY2025 results map out exactly what a successful listing looks like: 50% growth into the IPO, a swing to non-GAAP profitability in the year of listing, free cash flow ahead of reported income, and guidance that is beaten in the first two quarters. A private company that can show the first two of those has a credible story; one that can show all four has a Hinge story.
Consolidation is creating the scale. Sword's acquisitions of Kaia and Headspace are, among other things, IPO preparation. A combined entity with several hundred million dollars of revenue across MSK, mental health and cardiometabolic care is a much larger and more defensible listing than any of the three companies would have been on their own. The same logic applies to whichever platform ends up rolling up the long tail.
Put together, these make a 2027–2028 Sword listing the most likely next digital MSK IPO, and a reasonably high-probability one. A further wave beyond that depends on whether new scale players emerge, which, as the previous section argues, is doubtful.
The case against and what has to be true
The bear case is equally concrete.
Hinge's multiple is a profitability multiple, not a category multiple. The stock trades where it does because of a 31% free-cash-flow margin, not because the market loves MSK. Any company that cannot match that margin will be valued like Omada, at 4–5x sales, and at that price many private boards would rather stay private. Sword's own CEO has said he can list ten reasons not to IPO and none to do so; that was true when Hinge was at $45 and the maths has not changed much at $107.
Growth is decelerating at the leader. Hinge is guiding to roughly 25% growth in 2026, down from 51% in 2025. A category where the leader is already slowing is a harder one to sell as a growth IPO. The next listing will have to be framed as a margin and cash story from day one, which is a harder pitch for a company still absorbing acquisitions.
The window can close fast. Hinge itself scrapped a planned IPO in 2022 when the market turned. The sector went from two successful listings in mid-2025 to a renewed freeze in early 2026, when Hinge fell below its IPO price and Omada dropped under $13. A Sword listing in 2028 requires the 2028 market to look like October 2026, and nobody can promise that.
Private capital is cheap and patient. Sword raised $40 million at $4 billion with almost no dilution and has reportedly lined up far larger rounds to fund M&A. Secondary tenders handle employee liquidity. For a company already cash-flow positive, the cost of staying private is low, and the main thing an IPO would add is a public currency for acquisitions, which Sword is managing without.
Execution risk at the candidates. Sword is integrating two businesses, Kaia and Headspace, bought for nearly $600 million combined, while migrating Kaia's US members onto its own platform and entering Germany for the first time. Public investors have watched enough digital health roll-ups go wrong to want to see the integration finished before they underwrite it.
For another digital MSK IPO to happen, then, three things need to hold. The candidate needs Hinge-like unit economics and a clean set of audited numbers after its acquisitions. Hinge needs to keep delivering, because a stumble at the leader would re-rate the whole category overnight. And the broader IPO market needs to stay open into 2027–2028. Each is plausible. All three together is a narrower bet than the headline share price suggests.
Verdict
Yes, but probably only one, and not for a while. Hinge Health's trebling has done something the sector badly needed: it has proved to public investors that digital MSK can be a profitable, cash-generative business, and it has put a premium multiple on the board for the next company to aim at. That is enough to make a Sword Health listing in 2027 or 2028 the most likely next IPO in the category, and the Kaia and Headspace deals read as the groundwork for exactly that.
It is not enough to produce a wave. The companies that might have formed one have either been bought, are too small, or sell MSK as a feature rather than a business. The capital that would once have funded five IPO-scale competitors has instead funded consolidation into two. And the leader's own stock chart, from $45 to $30 to $107 inside nine months, is a reminder that the market's enthusiasm for the category is conditional on earnings, and that the condition can be withdrawn.
The practical read for anyone watching the space: Hinge's Q3 numbers in early November will tell you whether the re-rating has further to run, Sword's post-Headspace fundraising will tell you how seriously it is preparing for a listing, and the rest of the field is better tracked through M&A announcements than through S-1 filings.
Nelson Advisors > European Healthcare Technology Investment Banking
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