OPCH
Option Care Health, Inc.
$20.93
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 19.1% below fair value
You pay
$20.93
Bear
$20.70
Fair
$25.87
Bull
$31.04
Bear
$20.70
-1.1%
$1.28 × 15x P/E
Fair
$25.87
+23.6%
$1.28 × 19x P/E
Bull
$31.04
+48.3%
$1.28 × 23x P/E
Key Value Driver
Normalized P/E multiple (19x base case)
Implied Market Multiple
16.3x
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 $32.38 from 14 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $25.87 per share.
Warnings
Wall Street's average price target is $32.38 (from 14 analysts). Our estimate is 25% 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