DaVita Unit Acquired ModernMed - Analyst Blog
January 13 2012 - 7:15AM
Zacks
Yesterday, DaVita Inc.’s (DVA) subsidiary –
Paladina Health LLC – announced the acquisition of ModernMed, which
operates business-based clinics and physician practices in 12
states across the US. However, the terms of the transaction
remained undisclosed.
ModernMed’s extraordinary network of providers coupled with a
history of excellent care are expected to blend well with Paladina
and DaVita’s long-term strategy of growth through meaningful
acquisitions. Moreover, now that the uncertainties related to the
bundling rule and the capital markets have eased, more acquisitions
were probable.
Based on this view, in November last year, DaVita’s wholly-owned
subsidiary DV Care GmbH acquired ExtraCorp in Germany, in order to
expand its dialysis services. DaVita is also seeking international
pastures to expand its healthcare service portfolio. The company
has been looking for acquisition and partnership opportunities in
all major European and Asian countries over the past year.
Simultaneously, DaVita is also looking at domestic acquisitions.
In September 2011, the company completed the acquisition of its
competitor DSI Renal Inc. Additionally, such strong inorganic
growth also aids DaVita by providing competitive advantage to the
company against arch-rivals such as Gentiva Health Services
Inc. (GTIV) and Quest Diagnostics Inc.
(DGX).
Estimate Trend Revision
DaVita reported third-quarter 2011 operating earnings of $1.45
per share, beating the Zacks Consensus Estimate by a penny and also
modestly surpassing $1.15 per share recorded in the year-ago
quarter. Net operating income increased 15.6% year over year to
$138.2 million. Higher top line was partially offset by higher
expenses.
Currently, the Zacks Consensus Estimate for the fourth quarter
is operating earnings of $1.48 per share, which would be up by
about 31% from the year-ago quarter. Over the last 30 days, none of
the 12 analysts covering the stock have revised their estimates for
the fourth quarter, which further indicates no directional pressure
on the performance of the stock in the near term.
With respect to earnings surprises, the stock has been almost
steady over the last four quarters, with all three positive
surprises. The average remained positive at 0.97%. Additionally,
DaVita carries a Zacks Rank #2, which translates into a short-term
Buy rating and long-term Neutral stance.
On Thursday, the shares of DaVita closed at $78.88, up 0.4%, on
the New York Stock Exchange.
QUEST DIAGNOSTC (DGX): Free Stock Analysis Report
DAVITA INC (DVA): Free Stock Analysis Report
GENTIVA HEALTH (GTIV): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
DaVita (NYSE:DVA)
Historical Stock Chart
From May 2024 to Jun 2024
DaVita (NYSE:DVA)
Historical Stock Chart
From Jun 2023 to Jun 2024