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DaVita (DVA) Q1 Earnings & Revenues Top Estimates, Margins Up
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DaVita Inc. (DVA - Free Report) delivered adjusted earnings per share (EPS) of $2.38 in the first quarter of 2024, up 50.6% year over year. The figure topped the Zacks Consensus Estimate by 21.4%.
GAAP EPS for the quarter was $2.65, reflecting a surge of 112% year over year.
Revenues in Detail
Revenues of $3.07 billion in the first quarter increased 6.9% year over year. The figure surpassed the Zacks Consensus Estimate by 2%.
The top line was driven by solid performances of DaVita’s dialysis patient service revenues and Other revenues.
Segment Details
DaVita generates revenues via two sources — Dialysis patient service revenues and Other revenues.
The dialysis patient service revenues were $2.94 billion, up 6.6% year over year.
Other revenues were $129 million, up 14.5% from the year-ago quarter’s figure.
Per management, the total U.S. dialysis treatments for the first quarter were 7,151,512 or 92,159 per day, on average. This represents a per-day decrease of 0.4% on a sequential basis. Normalized non-acquired treatment growth in the first quarter of 2024 was 0.4% year over year.
As of Mar 31, 2024, DaVita provided dialysis services to around 258,600 patients at 3,092 outpatient dialysis centers, of which 2,665 were U.S. centers while 427 were located across 12 other countries.
As of Mar 31, 2024, DaVita had approximately 68,600 patients in risk-based integrated care arrangements in its Integrated kidney care business, representing $5.3 billion in annualized medical spend. The company also had an additional 14,200 patients in other integrated care arrangements.
During the first quarter of 2024, the company acquired and opened a total of 11 and closed 13 dialysis centers in the United States. It also acquired 67 dialysis centers, opened two and closed nine dialysis centers outside the United States in the same period.
In the quarter under review, DaVita’s gross profit rose 21.7% to $991.6 million. The gross margin expanded 394 basis points (bps) to 32.3%.
General & administrative expenses climbed 9.3% to $362.5 million.
Adjusted operating profit totaled $629.1 million, reflecting a 30.3% uptick from the prior-year quarter’s level. Adjusted operating margin in the first quarter expanded 368 bps to 20.5%.
Financial Position
DaVita exited first-quarter 2024 with cash and cash equivalents and short-term investments of $355.7 million compared with $391.7 million at 2023-end. Total debt (including the current portion) at the end of first-quarter 2024 was $9.13 billion compared with $8.39 billion at 2023-end.
Net cash used in operating activities at the end of first-quarter 2024 was $134.8 million against net cash provided by operating activities of $462.6 million a year ago.
2024 Guidance
DaVita has narrowed its adjusted EPS outlook for 2024.
Adjusted EPS for the full year is now projected to be in the range of $9.00-$9.80, narrowed from the previous expectations of $8.70-$9.80. The Zacks Consensus Estimate currently stands at $9.23.
Our Take
DaVita ended the first quarter of 2024 with better-than-expected results. The uptick in the company’s overall top-line and bottom-line performances was encouraging. Strength in both dialysis patient service and Other revenues during the period was impressive. The opening of dialysis centers within the United States and acquiring centers overseas were promising. The expansion of both margins bodes well for the stock.
However, the per-day decrease in total U.S. dialysis treatments for the first quarter on a sequential basis was disappointing. The company faced continued wage pressure challenges during the reported quarter, which was further concerning.
Zacks Rank and Key Picks
DaVita currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Align Technology, Inc. (ALGN - Free Report) , ResMed Inc. (RMD - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Align Technology, carrying a Zacks Rank of 2 (Buy), reported first-quarter 2024 adjusted EPS of $2.14, beating the Zacks Consensus Estimate by 8.1%. Revenues of $997.4 million outpaced the consensus mark by 2.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Align Technology has a long-term estimated growth rate of 6.9%. ALGN’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 5.9%.
ResMed reported third-quarter fiscal 2024 adjusted EPS of $2.13, beating the Zacks Consensus Estimate by 10.9%. Revenues of $1.19 billion surpassed the Zacks Consensus Estimate by 1.9%. It currently sports a Zacks Rank #1.
ResMed has a long-term estimated growth rate of 10.7%. RMD’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 2.8%.
Boston Scientific reported first-quarter 2024 adjusted EPS of 56 cents, beating the Zacks Consensus Estimate by 9.8%. Revenues of $3.86 billion surpassed the Zacks Consensus Estimate by 4.9%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 7.5%.
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DaVita (DVA) Q1 Earnings & Revenues Top Estimates, Margins Up
DaVita Inc. (DVA - Free Report) delivered adjusted earnings per share (EPS) of $2.38 in the first quarter of 2024, up 50.6% year over year. The figure topped the Zacks Consensus Estimate by 21.4%.
GAAP EPS for the quarter was $2.65, reflecting a surge of 112% year over year.
Revenues in Detail
Revenues of $3.07 billion in the first quarter increased 6.9% year over year. The figure surpassed the Zacks Consensus Estimate by 2%.
The top line was driven by solid performances of DaVita’s dialysis patient service revenues and Other revenues.
Segment Details
DaVita generates revenues via two sources — Dialysis patient service revenues and Other revenues.
The dialysis patient service revenues were $2.94 billion, up 6.6% year over year.
Other revenues were $129 million, up 14.5% from the year-ago quarter’s figure.
Per management, the total U.S. dialysis treatments for the first quarter were 7,151,512 or 92,159 per day, on average. This represents a per-day decrease of 0.4% on a sequential basis. Normalized non-acquired treatment growth in the first quarter of 2024 was 0.4% year over year.
As of Mar 31, 2024, DaVita provided dialysis services to around 258,600 patients at 3,092 outpatient dialysis centers, of which 2,665 were U.S. centers while 427 were located across 12 other countries.
As of Mar 31, 2024, DaVita had approximately 68,600 patients in risk-based integrated care arrangements in its Integrated kidney care business, representing $5.3 billion in annualized medical spend. The company also had an additional 14,200 patients in other integrated care arrangements.
During the first quarter of 2024, the company acquired and opened a total of 11 and closed 13 dialysis centers in the United States. It also acquired 67 dialysis centers, opened two and closed nine dialysis centers outside the United States in the same period.
DaVita Inc. Price, Consensus and EPS Surprise
DaVita Inc. price-consensus-eps-surprise-chart | DaVita Inc. Quote
Margin Details
In the quarter under review, DaVita’s gross profit rose 21.7% to $991.6 million. The gross margin expanded 394 basis points (bps) to 32.3%.
General & administrative expenses climbed 9.3% to $362.5 million.
Adjusted operating profit totaled $629.1 million, reflecting a 30.3% uptick from the prior-year quarter’s level. Adjusted operating margin in the first quarter expanded 368 bps to 20.5%.
Financial Position
DaVita exited first-quarter 2024 with cash and cash equivalents and short-term investments of $355.7 million compared with $391.7 million at 2023-end. Total debt (including the current portion) at the end of first-quarter 2024 was $9.13 billion compared with $8.39 billion at 2023-end.
Net cash used in operating activities at the end of first-quarter 2024 was $134.8 million against net cash provided by operating activities of $462.6 million a year ago.
2024 Guidance
DaVita has narrowed its adjusted EPS outlook for 2024.
Adjusted EPS for the full year is now projected to be in the range of $9.00-$9.80, narrowed from the previous expectations of $8.70-$9.80. The Zacks Consensus Estimate currently stands at $9.23.
Our Take
DaVita ended the first quarter of 2024 with better-than-expected results. The uptick in the company’s overall top-line and bottom-line performances was encouraging. Strength in both dialysis patient service and Other revenues during the period was impressive. The opening of dialysis centers within the United States and acquiring centers overseas were promising. The expansion of both margins bodes well for the stock.
However, the per-day decrease in total U.S. dialysis treatments for the first quarter on a sequential basis was disappointing. The company faced continued wage pressure challenges during the reported quarter, which was further concerning.
Zacks Rank and Key Picks
DaVita currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Align Technology, Inc. (ALGN - Free Report) , ResMed Inc. (RMD - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Align Technology, carrying a Zacks Rank of 2 (Buy), reported first-quarter 2024 adjusted EPS of $2.14, beating the Zacks Consensus Estimate by 8.1%. Revenues of $997.4 million outpaced the consensus mark by 2.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Align Technology has a long-term estimated growth rate of 6.9%. ALGN’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 5.9%.
ResMed reported third-quarter fiscal 2024 adjusted EPS of $2.13, beating the Zacks Consensus Estimate by 10.9%. Revenues of $1.19 billion surpassed the Zacks Consensus Estimate by 1.9%. It currently sports a Zacks Rank #1.
ResMed has a long-term estimated growth rate of 10.7%. RMD’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 2.8%.
Boston Scientific reported first-quarter 2024 adjusted EPS of 56 cents, beating the Zacks Consensus Estimate by 9.8%. Revenues of $3.86 billion surpassed the Zacks Consensus Estimate by 4.9%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 7.5%.