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.
