ValueMaven Posted November 9, 2017 Share Posted November 9, 2017 I started a position in DVA this afternoon... Sincerely, VM Link to comment Share on other sites More sharing options...
sleepydragon Posted November 9, 2017 Share Posted November 9, 2017 I started a position in DVA this afternoon... Sincerely, VM what JPM says about DVA? :P Link to comment Share on other sites More sharing options...
whiterose Posted November 23, 2017 Share Posted November 23, 2017 DaVita explores sale of physician network business: DaVita Inc (DVA.N), the largest U.S. provider of kidney care services, is exploring a sale of its physician network business, DaVita Medical Group, that could value the unit at up to $4 billion, according to people familiar with the matter. https://www.reuters.com/article/us-davita-m-a-davita-medical-group-exclu/exclusive-davita-explores-sale-of-physician-network-business-sources-idUSKBN1DM2PB Link to comment Share on other sites More sharing options...
rb Posted November 23, 2017 Share Posted November 23, 2017 DaVita explores sale of physician network business: DaVita Inc (DVA.N), the largest U.S. provider of kidney care services, is exploring a sale of its physician network business, DaVita Medical Group, that could value the unit at up to $4 billion, according to people familiar with the matter. https://www.reuters.com/article/us-davita-m-a-davita-medical-group-exclu/exclusive-davita-explores-sale-of-physician-network-business-sources-idUSKBN1DM2PB Ooohh! That's not good. Link to comment Share on other sites More sharing options...
Txvestor Posted November 23, 2017 Share Posted November 23, 2017 Actually if they get a decent price, which they could from a strategic buyer like a large medicare advantage insurer, this could turn out to be a good decision for them albeit an admission of a prior failed strategy. They have had a miserable time of running it, and obviously they're not produsing anything close to the returns they initially projected. In addition I am sure it has taken up a disproportionate share of management's time and attention, and appears nowhere close to a turnaround. If DVA were to sell this off and use the proceeds to do a share buyback it could be incredibly accretive. Having a near duopoly scale advantage position in the hemodialysis market with yet more roll up and organic growth opportunity remaining is not exactly a bad/business place to be in. They can then return their focus to their core competency and the stock price will respond. Link to comment Share on other sites More sharing options...
bennycx Posted November 23, 2017 Share Posted November 23, 2017 Question: why is everyone talking about Davita and not Fresenius? Is it just because Ted W has bought it? Link to comment Share on other sites More sharing options...
MrB Posted November 23, 2017 Share Posted November 23, 2017 Actually if they get a decent price, which they could from a strategic buyer like a large medicare advantage insurer, this could turn out to be a good decision for them albeit an admission of a prior failed strategy. They have had a miserable time of running it, and obviously they're not produsing anything close to the returns they initially projected. In addition I am sure it has taken up a disproportionate share of management's time and attention, and appears nowhere close to a turnaround. If DVA were to sell this off and use the proceeds to do a share buyback it could be incredibly accretive. Having a near duopoly scale advantage position in the hemodialysis market with yet more roll up and organic growth opportunity remaining is not exactly a bad/business place to be in. They can then return their focus to their core competency and the stock price will respond. Question is how much does one fault them for buying it in the first place? Probably was not the worst idea at the time, because managing patients more effectively does seem to be a good solution due to the complexity and how it relates to outcomes. Also reasonable time frame to realise you made a mistake, sell it and move on. Therefore good theory, but if you cannot make it work then move on. Selling it and buying back more of your stock sits better with me than throwing more money at it. Link to comment Share on other sites More sharing options...
MrB Posted November 23, 2017 Share Posted November 23, 2017 Question: why is everyone talking about Davita and not Fresenius? Is it just because Ted W has bought it? Ted actually owned both and in a meaningful way over the years. Speaking for myself, Davita is more of a pure play on "dialysis services" and has a higher probability of meaningful share buybacks over the next 4 years (around $5Bn), which is meaningful considering $10.6Bn market cap. Lastly meaningful difference in valuation, which again need to be considered in light of the difference in ROE & ROC. Link to comment Share on other sites More sharing options...
MrB Posted November 23, 2017 Share Posted November 23, 2017 DaVita explores sale of physician network business: DaVita Inc (DVA.N), the largest U.S. provider of kidney care services, is exploring a sale of its physician network business, DaVita Medical Group, that could value the unit at up to $4 billion, according to people familiar with the matter. https://www.reuters.com/article/us-davita-m-a-davita-medical-group-exclu/exclusive-davita-explores-sale-of-physician-network-business-sources-idUSKBN1DM2PB Happy Thanksgiving Jim... Link to comment Share on other sites More sharing options...
ValueMaven Posted November 23, 2017 Share Posted November 23, 2017 If they really got $4bn for it - it would be a huge homerun. Either way the stock is dirt cheap Link to comment Share on other sites More sharing options...
sleepydragon Posted November 23, 2017 Share Posted November 23, 2017 If they really got $4bn for it - it would be a huge homerun. Either way the stock is dirt cheap Or maybe the buyer just buy the whole company? Healthcare vertical integrations are in play. Cvs? Link to comment Share on other sites More sharing options...
sleepydragon Posted November 23, 2017 Share Posted November 23, 2017 Question: why is everyone talking about Davita and not Fresenius? Is it just because Ted W has bought it? FSM is trading at a much higher pe premium because in Europe dialysis is fully paid by govt at a good profit margin. DVA is more a bet that the profit margin will improve over time (maybe like Europe one day) and pe multiple will improve. Link to comment Share on other sites More sharing options...
Txvestor Posted November 24, 2017 Share Posted November 24, 2017 Actually if they get a decent price, which they could from a strategic buyer like a large medicare advantage insurer, this could turn out to be a good decision for them albeit an admission of a prior failed strategy. They have had a miserable time of running it, and obviously they're not produsing anything close to the returns they initially projected. In addition I am sure it has taken up a disproportionate share of management's time and attention, and appears nowhere close to a turnaround. If DVA were to sell this off and use the proceeds to do a share buyback it could be incredibly accretive. Having a near duopoly scale advantage position in the hemodialysis market with yet more roll up and organic growth opportunity remaining is not exactly a bad/business place to be in. They can then return their focus to their core competency and the stock price will respond. Question is how much does one fault them for buying it in the first place? Probably was not the worst idea at the time, because managing patients more effectively does seem to be a good solution due to the complexity and how it relates to outcomes. Also reasonable time frame to realise you made a mistake, sell it and move on. Therefore good theory, but if you cannot make it work then move on. Selling it and buying back more of your stock sits better with me than throwing more money at it. It was absolutely a disaster of a purchase. 100% a mistake, if that is not obvious from what I said already. This is about as much acknowledgement as you're ever going to get from a typically ego laced American boardroom. Partners healthcare, since renamed was not a renal specialty medical practice, it was a much broader network of providers. It was not their core competency and they did not manage it properly, it did not deliver any synergies, and certainly never delivered anything close to the ROI they projected. They are ever so gently admitting it now. Additionally it was a sizeable purchase considering their own size. If you want a comparison on how it is when done well, then look to the growth of the optum division burried within Unitedhealth, they have been putting up crazy impressive numbers with their acquisitions based strategy. I do agree that a share buyback is in order with the proceeds at these levels. As to reimbursements, yes they are stingy in the US, but its ironic how many people esp. the public(and perhaps even more broadly on this forum) think otherwise. Medical reimbursement is a fairly opaque mess, and what I have noticed is that you make money in the US either from a monopolistic pricing power eg. Patented drugs, or generic drugs masqueraded as such eg epipen until recently, or scale based negotiation of service pricing with private insurers eg. large single specialty medical groups, or Heavy DC lobbying organizational power eg. AHA and other medical products supplier groups, that protect the tariffs. Other than than medicare is actually a pretty stingy payer when considering the cost of doing business in the US. Witness the rapid disappearance of smaller medical practices and smaller dialysis centers. Link to comment Share on other sites More sharing options...
mwtorock Posted November 24, 2017 Share Posted November 24, 2017 Mixed feelings to the news but overall leaning towards positive. Everyone makes mistakes, but management probably realized this a little too late. It is good if they are really selling it. Link to comment Share on other sites More sharing options...
gfp Posted November 29, 2017 Share Posted November 29, 2017 Medical Group bought another physician network. Interesting that they are expanding at the same time the rumor is they are being marketed for sale? http://pressreleases.davita.com/2017-11-28-DaVita-Medical-Group-Acquires-Large-IPA-Network-in-the-Pacific-Northwest Link to comment Share on other sites More sharing options...
MrB Posted November 29, 2017 Share Posted November 29, 2017 Medical Group bought another physician network. Interesting that they are expanding at the same time the rumor is they are being marketed for sale? http://pressreleases.davita.com/2017-11-28-DaVita-Medical-Group-Acquires-Large-IPA-Network-in-the-Pacific-Northwest Not sure how much it means. I thought the same, but then business is not going to stop even if they are selling it. Probably just makes it more attractive to the buyer anyway. Link to comment Share on other sites More sharing options...
MrB Posted November 29, 2017 Share Posted November 29, 2017 Both the Dialysis PATIENTS Demonstration Act of 2017 and the Access to Marketplace Insurance Act signing up new sponsors regularly. Getting up to good numbers now. https://www.congress.gov/bill/115th-congress/house-bill/3976/cosponsors?pageSort=lastToFirst&loclr=cga-bill https://www.congress.gov/bill/115th-congress/house-bill/4143/cosponsors?pageSort=lastToFirst&loclr=cga-bill Link to comment Share on other sites More sharing options...
Foreign Tuffett Posted November 29, 2017 Share Posted November 29, 2017 Could this have implications for the AKF? https://www.bloomberg.com/news/articles/2017-11-29/pharma-charity-may-shut-after-u-s-faults-drugmakers-influence First sentence: "A medical charity that received hundreds of millions of dollars from pharmaceutical companies lost a crucial stamp of approval from the U.S. government, after allowing its donors improper influence over how the nonprofit was run." Link to comment Share on other sites More sharing options...
DooDiligence Posted November 30, 2017 Share Posted November 30, 2017 Could this have implications for the AKF? https://www.bloomberg.com/news/articles/2017-11-29/pharma-charity-may-shut-after-u-s-faults-drugmakers-influence First sentence: "A medical charity that received hundreds of millions of dollars from pharmaceutical companies lost a crucial stamp of approval from the U.S. government, after allowing its donors improper influence over how the nonprofit was run." There are a lot of alternatives to Xyrem so steering to the most expensive choice does seem whiffy. Not so many choices with ESRD (someone feel free to slap this weakly informed opinion down.) The treatment that Davita gets from payers just seems like bullying to me & once a bully gets a taste... Link to comment Share on other sites More sharing options...
cubsfan Posted November 30, 2017 Share Posted November 30, 2017 Both the Dialysis PATIENTS Demonstration Act of 2017 and the Access to Marketplace Insurance Act signing up new sponsors regularly. Getting up to good numbers now. https://www.congress.gov/bill/115th-congress/house-bill/3976/cosponsors?pageSort=lastToFirst&loclr=cga-bill https://www.congress.gov/bill/115th-congress/house-bill/4143/cosponsors?pageSort=lastToFirst&loclr=cga-bill MR. B - I have read this - but do not quite "get it". Since I'm a little dense, can you give a few comments as to the impact? Specifically, I'm not quite sure how this compares to prior legislation, and what areas it strengthens or impacts. Thanks for any comments. Link to comment Share on other sites More sharing options...
MrB Posted November 30, 2017 Share Posted November 30, 2017 Both the Dialysis PATIENTS Demonstration Act of 2017 and the Access to Marketplace Insurance Act signing up new sponsors regularly. Getting up to good numbers now. https://www.congress.gov/bill/115th-congress/house-bill/3976/cosponsors?pageSort=lastToFirst&loclr=cga-bill https://www.congress.gov/bill/115th-congress/house-bill/4143/cosponsors?pageSort=lastToFirst&loclr=cga-bill MR. B - I have read this - but do not quite "get it". Since I'm a little dense, can you give a few comments as to the impact? Specifically, I'm not quite sure how this compares to prior legislation, and what areas it strengthens or impacts. Thanks for any comments. Sure. I think we might have covered it earlier in the thread, but here's a few quick links. Dialysis PATIENTS Demonstration Act - two sides http://www.dialysispatients.org/articles/dialysis-patient-citizens-applauds-introduction-dialysis-patient-demonstration-bills http://www.dciinc.org/wp-content/uploads/2017/11/DPDA-Harming_the_future_of_kidney_care_-2017_11_09.pdf Access to Marketplace Insurance Act https://cramer.house.gov/media-center/press-releases/cramer-sponsors-legislation-to-close-obamacare-loophole-preventing Link to comment Share on other sites More sharing options...
ValueMaven Posted December 1, 2017 Share Posted December 1, 2017 I take it then that this is a positive for DaVita?? Sincerely, VM Link to comment Share on other sites More sharing options...
MrB Posted December 6, 2017 Share Posted December 6, 2017 Merry Christmas Jim! UnitedHealth to buy DaVita's medical unit for $4.9 billion (cash) https://www.reuters.com/article/us-davita-m-a-unitedhealth/unitedhealth-to-buy-davitas-medical-unit-for-4-9-billion-idUSKBN1E01HJ "DAVITA PLANS TO USE PROCEEDS FROM DEAL FOR SIGNIFICANT STOCK REPURCHASES OVER 1 TO 2 YRS AFTER CLOSE OF DEAL, AS WELL AS TO REPAY DEBT, OTHERS" Up 11.2% pre market Link to comment Share on other sites More sharing options...
maxthetrade Posted December 6, 2017 Share Posted December 6, 2017 Great news. Let's hope they buy back a shitload of stock! Link to comment Share on other sites More sharing options...
DooDiligence Posted December 6, 2017 Share Posted December 6, 2017 Merry Christmas Jim! UnitedHealth to buy DaVita's medical unit for $4.9 billion (cash) https://www.reuters.com/article/us-davita-m-a-unitedhealth/unitedhealth-to-buy-davitas-medical-unit-for-4-9-billion-idUSKBN1E01HJ "DAVITA PLANS TO USE PROCEEDS FROM DEAL FOR SIGNIFICANT STOCK REPURCHASES OVER 1 TO 2 YRS AFTER CLOSE OF DEAL, AS WELL AS TO REPAY DEBT, OTHERS" Up 11.2% pre market That was fast. Link to comment Share on other sites More sharing options...
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