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DaVita Inc. (DVA) is a leading provider of dialysis services in the U.S., specializing in care for patients with chronic kidney failure, also known as end-stage renal disease (ESRD). With a market cap of $14.2 billion, the company operates numerous dialysis centers and offers a variety of related medical services.
Companies valued at $10 billion or more are generally considered "large-cap" stocks, and DaVita fits this criterion perfectly. DaVita is renowned for its extensive network of outpatient and inpatient dialysis centers and its strong focus on integrated care and disease management services, making it a leader in the U.S. dialysis market with a significant patient base.
However, the dialysis services company is trading 2.3% below its 52-week high of $166.04, hit in September. Despite this, shares of DaVita have climbed 14.1% over the past three months, overshadowing the broader Dow Jones Industrials Average's ($DOWI) 7.8% rise over the same time frame.
Longer term, DVA has surged 54.9% on a YTD basis, significantly outperforming DOWI's 11.9% gains. Moreover, shares of DaVita have jumped 69.6% over the past 52 weeks, compared to DOWI’s 25.5% returns over the same time frame.
DVA has shown a bullish price trend, consistently trading above its 50-day and 200-day moving average since November last year despite a few fluctuations.
Despite reporting stronger-than-expected Q2 adjusted EPS of $2.59 and revenue of $3.19 billion on Aug. 6, DaVita's shares fell 2.2% the following day due to concerns over ongoing delays in claims processing related to the Change Healthcare outage. Furthermore, investors were cautious about the potential long-term impact of new GLP-1 weight-loss drugs, which could dampen demand for dialysis services, despite the company’s positive outlook for 2024.
Nevertheless, DaVita has shown significant double-digit returns in both YTD basis and over the past 52 weeks, contrasting with its rival Amedisys, Inc. (AMED), which has risen 2.2% and 3.5% in the respective periods.
Despite DVA's impressive gains, analysts are cautious about its prospects. Among the eight analysts covering the stock, there is a consensus rating of “Hold,” and it is currently trading above the mean price target of $155.86.
On the date of publication, Sohini Mondal 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.
