DVA
DaVita Inc.
$198.52
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 23.6% above fair value
You pay
$198.52
Bear
$128.48
Fair
$160.59
Bull
$192.71
Bear
$128.48
-35.3%
$9.78 × 12x P/E
Fair
$160.59
-19.1%
$9.78 × 15x P/E
Bull
$192.71
-2.9%
$9.78 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
20.3x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $202.25 from 23 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $160.59 per share.
Warnings
Wall Street's average price target is $202.25 (from 23 analysts). Our estimate is 27% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples