CD&R and McKesson ink $5.8bn take-private deal for Option Care Health
Option Care Health provides home and alternate site infusion services in all 50 US states, with more than 8,000 staff including over 5,000 clinicians. The post CD&R and McKesson ink $5.8bn take-private deal for Option Care Health appeared first on PE Hub .
Truist Securities has maintained its positive outlook on Option Care Health (OPCH) stock, reiterating a Buy rating with a price target of $30.00 following reports of advanced sale talks. The Financial Times revealed the company is in negotiations to sell to McKesson and Clayton Dubilier & Rice for a valuation surpassing $5 billion, with a potential announcement by October 6. As of October 5, Option Care Health's enterprise value was recorded at $4.55 billion.
Truist emphasizes the company's strategic positioning due to industry growth factors, such as an aging population and the shift towards lower-cost, patient-preferred care settings. Additionally, Truist highlights the company's strong payer relationships, in-network status with top providers, and coverage of 96% of insured lives as advantageous factors.
The firm remains bullish on Option Care Health's portfolio, citing its diverse assets, including a sizable Advanced Provider Services (APS) footprint, a growing advanced practitioner model, and robust free cash flow generation.
Recent analyst sentiment supports Truist's optimism, with 5 analysts revising their earnings estimates upward for the upcoming period. The company's second-quarter earnings exceeded expectations, with adjusted earnings per share of $0.45 surpassing the consensus estimate of $0.43. Revenue for the quarter also surpassed projections at $1.44 billion, compared to the anticipated $1.42 billion.
Management cited improving cash flow and stronger adjusted EBITDA, along with a narrowed full-year profit guidance, which reassured investors despite ongoing challenges in the chronic inflammatory disease business.
Other analysts maintain mixed views on the stock. UBS maintained its Buy rating with a price target of $39.00, praising the company's consistent messaging and execution focus. Conversely, Deutsche Bank downgraded the stock to Hold, reducing its price target from $26.00 to $24.00, citing growth concerns. Deutsche Bank's analyst, Pito Chickering, acknowledged an EBITDA beat but expressed disappointment in the company's adjusted guidance reduction.
Written by urgent.news from Investing.com's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
