KeyBanc has commenced coverage on BrightSpring Health (NASDAQ: BTSG), assigning a Sector Weight rating to the company’s stock.
The firm highlighted BrightSpring Health’s evolution since its formation through the 2019 merger between Pharmerica and ResCare.
The current business structure of BrightSpring Health stands distinct from those of the legacy companies, with a focus on Pharmacy Solutions and Provider Services.
BrightSpring Health’s Pharmacy Solutions is noted for its infusion, specialty, and community pharmacy capabilities. According to the coverage, the specialty pharmacy aspect of the business is particularly well-differentiated and is aligned with significant growth drivers.
The company’s Provider Services segment, which includes home health, hospice, and community & rehabilitation services, operates in markets that are both large and expanding.
KeyBanc pointed out that BrightSpring Health’s combined platform benefits from considerable opportunities for internal growth. These opportunities are primarily driven by potential cross-sales and value-based care (VBC) initiatives. The company’s unique pharmacy capabilities are leveraged within its comprehensive healthcare services offering, suggesting a strategic integration of its various segments.
BrightSpring Health, through its diversified services, is positioned to tap into the growth potential within the healthcare and pharmacy sectors. The company’s integrated service model, which includes a range of healthcare and pharmacy services, is designed to meet the complex needs of the markets it serves.
In other recent news, BrightSpring Health has seen a flurry of significant developments. BTIG has upgraded its outlook for the company, raising the price target from $15.00 to $20.00, while maintaining a Buy rating. They cited BrightSpring’s advantageous position due to recent healthcare legislation and industry trends. The company also announced the appointment of Dr. Steve Miller to its board of directors, a move expected to enhance its patient care strategies.
BrightSpring completed a $60 million acquisition of Haven Hospice assets in Florida, extending its services to 18 counties in the state. On the investment front, KKR & Co. Inc. agreed to purchase 11,619,998 of BrightSpring’s common stock shares from Walgreens Boots Alliance (NASDAQ:). Furthermore, BrightSpring expanded its presence through several acquisitions, including a Maryland home health operation, a Michigan behavioral therapy company, and a Montana long-term care pharmacy.
Finally, healthcare veteran Timothy A. Wicks joined BrightSpring’s board of directors, a strategic move aimed at leveraging Wicks’ extensive industry knowledge.
InvestingPro Insights
BrightSpring Health’s (NASDAQ:BTSG) recent coverage by KeyBanc aligns with several key financial metrics and insights from InvestingPro. The company’s market cap stands at $2.6 billion, reflecting its significant presence in the Healthcare Providers & Services industry.
InvestingPro data shows that BrightSpring’s revenue growth has been robust, with a 21.98% increase over the last twelve months as of Q2 2024, and an even stronger 26.01% growth in the most recent quarter. This aligns with KeyBanc’s observation of the company’s growth opportunities, particularly in its specialty pharmacy business and expanding healthcare services markets.
However, profitability remains a challenge. The company’s P/E ratio is negative at -17.01, indicating that it’s not currently profitable. This is corroborated by an InvestingPro Tip noting that BrightSpring has not been profitable over the last twelve months. Nevertheless, another InvestingPro Tip suggests that analysts predict the company will become profitable this year, which could be a positive sign for investors.
The stock’s recent performance has been strong, with a 36.67% price return over the last three months and a 45.45% return over the past six months. This momentum has brought the stock price to 98.06% of its 52-week high, as highlighted by an InvestingPro Tip.
For readers interested in a deeper analysis, InvestingPro offers 11 additional tips for BrightSpring Health, providing a more comprehensive view of the company’s financial health and market position.
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