Denver, Colorado-based DaVita Inc. (DVA) provides kidney dialysis services for patients suffering from chronic kidney failure in the United States. Valued at a market cap of almost $12.5 billion, the company also offers outpatient, hospital inpatient, and home-based hemodialysis services and operates clinical laboratories as well.
Companies worth $10 billion or more are generally described as “large-cap” stocks, and DaVita fits right into that category. The company is a leading provider of dialysis services and is renowned for treating patients with chronic kidney failure and end-stage renal disease (ESRD). It is also known for offering a variety of healthcare services, including integrated treatment plans, personalized care teams, and health management services.
The medical care facilities provider’s shares have slipped 9.7% from its 52-week high of $169.51, achieved on Nov. 27. It has fallen 5.3% over the past three months, still outpacing the broader Health Care Select Sector SPDR Fund’s (XLV) 10.1% decline over the same time frame.
Moreover, in the longer term, DVA has rallied 46.7% over the past 52 weeks, significantly surpassing XLV’s 2.8% returns. Over the past six months, shares of DVA are up 8.2%, outperforming XLV’s 5.5% decline over the same time frame.
While DVA has been trading below its 50-day moving average since early December, it has remained above its 200-day moving average since the past year.
Shares of DVA plunged 10.8% after its Q3 earnings release on Oct. 29 as its adjusted EPS decreased 9.1% year-over-year to $2.59 and missed the consensus estimates by 6.2%. A 26.2% annual fall in other revenues and the year-over-year decline in normalized non-acquired treatment might have further dampened investor confidence.
Nevertheless, a 6.3% growth in dialysis patient service revenues coupled with an increase in average reimbursement rates and other normal fluctuations led to a 4.6% annual uptick in revenues to $3.26 billion, which surpassed the forecasted figure by 1.2%.
DVA has outpaced its rival, Fresenius Medical Care AG’s (FMS) 8.6% rise over the past 52 weeks but has lagged behind FMS’s 16.9% increase on a six-month basis.
Despite DaVita’s recent outperformance relative to its broader sector, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the eight analysts covering it, and the mean price target of $163 suggests a modest 6.5% premium to its current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. More news from Barchart- Intuit Stock Is Trading Flat - But Shorting One-Month Puts and Calls Yield 1.0%
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