Is an Acquisition in the cards for Cano Health Inc (NYSE:CANO)
Shares of Cano Health Inc (NYSE:CANO) have been relatively flat this year. The healthcare company had an abysmal performance in 2022, seeing its stock tank 85%. A year ago, the stock was trading at around $6 — multiple times higher then the current share price.
In October of last year, its stock tanked after it was reported that CVS Health was no longer looking to acquire CANO. Prior to that, there were rumors that both CVS and Humana were potential buyers. Since there has been no official word of Humana backing out.
The company recently reported their Q4 earnings report, and according to Zacks Equity Research, Cano Health, Inc. came out with quarterly earnings of $0.18 per share, beating the Zacks Consensus Estimate of a loss of $0.10 per share. This compares to loss of $0.12 per share a year ago. These figures are adjusted for non-recurring items.
Total revenue was $2,738.9 million, compared to $1,609.4 million in the prior year. An increase of 70% year-over-year.
CANO Health operates in a sector that is IN Demand, primary care centers that focus on senior care. During 2022, the company opened 24 de novo medical centers and added another 18 centers on a net basis through acquisitions in existing markets. Cano Health ended the year with 172 medical centers in Florida, Texas, Nevada, Illinois, New Mexico, California and Puerto Rico, while total membership reached nearly 310,000 members growing 36% from the prior year.
Of interest from their latest 10-k filing the company stated “In addition, we have entered into expansion agreements with Humana which provide a roadmap to opening new Humana funded medical centers in the southwestern U.S. by 2024”
One can’t help but wonder, is Humana still at the table and will they feast on Cano Health while the company is trading at a valuation in the mid 500 million range. (Seemingly very cheap especially when you consider CVS Health Corp. agreed to buy Oak Street Health Inc. in a $10.6 billion deal).
Notable stock in the health care sector include CVS Health (NYSE:CVS), Chemed (NYSE:CHE), Signify Health (NYSE:SGFY), Agiliti (NYSE:AGTI), Hims & Hers Health (NYSE:HIMS) and Privia Health Gr (NASDAQ:PRVA). Other companies in Humana’s (NYSE:HUM) space includes: HealthEquity (NASDAQ:HQY), Tekla World Healthcare (NYSE:THW), Molina Healthcare (NYSE:MOH), Progyny (NASDAQ:PGNY) and Alignment Healthcare (NASDAQ:ALHC).
Disclaimer: I/We have a beneficial long position in the shares of CANO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
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