Don't Miss These Facts About Option Care Health

Now trading at a price of $25.18, Option Care Health has moved -23.2% so far today.

Option Care Health returned gains of 12.4% last year, with its stock price reaching a high of $35.87 and a low of $24.23. Over the same period, the stock outperformed the S&P 500 index by 14.0%. More recently, the company's 50-day average price was $31.63. Option Care Health, Inc. offers home and alternate site infusion services in the United States. Based in Bannockburn, IL, the mid-cap Health Care company has 5,597 full time employees. Option Care Health has not offered a dividend during the last year.

Growing Revenues With Increasing Reinvestment in the Business:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $2,310 $3,033 $3,439 $3,945
Gross Margins 22.2% 22.5% 22.7% 22.0%
Operating Margins -0.0% 3.6% 5.6% 6.1%
Net Margins -3.29% -0.27% 4.07% 3.82%
Net Income (MM) -$76 -$8 $140 $151
Net Interest Income -$73,724 -$107,770 -$67,003 -$53,806
Depreciation & Amort. -$57,869 -$77,896 -$68,804 -$65,434
Earnings Per Share -$1.96 -$0.04 $0.77 $0.82
EPS Growth n/a 97.96% 2025.0% 6.49%
Diluted Shares (MM) 156 202 182 179
Free Cash Flow (MM) $11 $101 $183 $232
Capital Expenditures (MM) -$28 -$27 -$26 -$35
Net Current Assets (MM) -$1,124 -$975 -$905 -$732
Current Ratio 1.69 1.51 1.55 1.76
Long Term Debt $1,277,246 $1,115,103 $1,059,900 $1,058,204
Net Debt / EBITDA 23.22 5.79 3.83 2.43

Option Care Health has a pattern of improving cash flows. Additionally, the company's financial statements display wider gross margins than its peer group and positive EPS growth. However, the firm has a highly leveraged balance sheet. Finally, we note that Option Care Health has average net margins with a positive growth rate and a decent current ratio.

A Lower P/B Ratio Than Its Sector Average but Trades Above Its Graham Number:

Option Care Health has a trailing twelve month P/E ratio of 38.6, compared to an average of 24.45 for the Health Care sector. Based on its EPS guidance of $1.1, the company has a forward P/E ratio of 28.8. The 9.3% compound average growth rate of Option Care Health's historical and projected earnings per share yields a PEG ratio of 4.14. This suggests that these shares are overvalued. In contrast, the market is likely undervaluing Option Care Health in terms of its equity because its P/B ratio is 3.3 while the sector average is 4.16. The company's shares are currently trading 112.3% above their Graham number. In conclusion, Option Care Health's impressive cash flow trend, decent P/B ratio, and reasonable use of leverage demonstrate that the company may still be fairly valued — despite its elevated earnings multiple.

There's an Analyst Consensus of Strong Upside Potential for Option Care Health:

The 6 analysts following Option Care Health have set target prices ranging from $38.0 to $41.0 per share, for an average of $38.83 with a buy rating. As of April 2023, the company is trading -18.5% away from its average target price, indicating that there is an analyst consensus of strong upside potential.

Option Care Health has an average amount of shares sold short because 3.3% of the company's shares are sold short. Institutions own 85.8% of the company's shares, and the insider ownership rate stands at 6.35%, suggesting a decent amount of insider shareholders. The largest shareholder is Blackrock Inc., whose 11% stake in the company is worth $497,769,802.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.