DVA – DaVita HealthCare Partners

[DooDiligence]

https://www.forbes.com/sites/brucejapsen/2019/05/23/unitedhealth-were-still-working-on-closing-davita-deal/#7795312f2abf

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Cramer doesn't like Davita.
I may buy more.

[thefatbaboon]

Is this deal ever going to happen

 

[ander]

Is this deal ever going to happen

 

https://news.bloomberglaw.com/mergers-and-antitrust/davita-gains-on-report-ftc-staff-nearing-approving-unh-unit-deal?utm_source=rss&utm_medium=MANW&utm_campaign=0000016b-32ac-dcbd-ad6b-faecfe8e0000

According to Capitol Forum it seems like a vote to approve may happen within the next couple of weeks. Though, I guess the market is saying it doesn't care and / or doesn't believe it.

[thefatbaboon]

What a saga this HCP investment has been!

[ander]

https://www.forbes.com/sites/brucejapsen/2019/06/19/unitedhealth-group-wins-ftc-approval-of-davita-deal/#1683cad16e40

"UnitedHealth Group Wins FTC Approval Of DaVita Deal"

Reporter states FTC to announce officially later this afternoon. DVA and UNH have not commented.

[ander]

https://www.businesswire.com/news/home/20190619005805/en/

Now the deal has finally closed. What a saga.

[cubsfan]

https://www.businesswire.com/news/home/20190619005805/en/

Now the deal has finally closed. What a saga.

brutal wait

[Spekulatius]

Cost pressure are relentless. It seems like costs are raising faster than reimbursements, maybe due to labor market tightness? the smaller players are probably sucking air through a straw. Fresenius on the other hand seems to be doing better, due to being more diversified.

[ander]

Cost pressure are relentless. It seems like costs are raising faster than reimbursements, maybe due to labor market tightness? the smaller players are probably sucking air through a straw. Fresenius on the other hand seems to be doing better, due to being more diversified.

Part of the slower reimbursement rise has been because the out-of-network commercial amounts are coming down. It's pretty small currently but is a small headwind. Labor market has been affecting them like everyone else, but the cost pressures have always been there and like you're saying they manage better than the smaller guys so at some stage rates catch up a little bit as well. Fresenius is doing better on volumes this past quarter but that's lumpy. DVA has had a lot of "one-off" headwinds for the past 3 years. Assuming that those do not go away and are permanent, I still expect them to start growing EBIT in-line with previous history over the next 3 years. A large opportunity is Medicare Advantage patients which start in 2021 -- that could add up to 20% of EBIT alone. I'm looking forward to their Investor Day later this year and also am looking forward to them buying back up to 1/3 of the market cap over the next 12 to 18 mos.

[MrB]

"buying back up to 1/3 of the market cap over the next 12 to 18 mos."
How do you figure that?