Deutsche Downgrades Agilon Health to ‘Hold’ Citing ‘Overly Optimistic’ Targets
November 25, 2023
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Agilon Health ($NYSE:AGL) is a healthcare technology company that is focused on driving and enabling precision health and value-based care. Recently, Deutsche Bank has downgraded its rating of Agilon Health to a ‘Hold’ position, citing overly optimistic targets set by the company. This decision was based on the fact that the targets set by Agilon Health have been deemed too hopeful due to a number of factors, such as the industry’s current competitive landscape and potential market disruption. The downgrade by Deutsche Bank reflects a pessimistic outlook on the company’s ability to meet its stated targets.
Furthermore, this could lead to other firms following suit in downgrading Agilon’s stock, which could create further obstacles for the company. It is yet to be seen how Agilon Health will respond to this downgrade, and whether or not they will be able to achieve their goals despite the lower rating. Only time will tell if the company is able to turn things around and prove Deutsche Bank wrong in their assessment.
Price History
On Tuesday, Deutsche Bank downgraded AGILON HEALTH‘s stock to “Hold” from “Buy”. The bank cited overly optimistic targets and potential delays in the company’s ability to meet them as the reasons for the downgrade. The stock opened the day at $11.0 and closed at the same price, a decrease of 4.5% from the previous closing price of 11.5. The downgrade has caused investors to be wary of AGILON HEALTH’s stock and its future prospects. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Agilon Health. More…
| Total Revenues | Net Income | Net Margin |
| 4.19k | -88.63 | -2.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Agilon Health. More…
| Operations | Investing | Financing |
| -144.99 | -49.79 | -191.16 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Agilon Health. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.28k | 1.41k | 2.15 |
Key Ratios Snapshot
Some of the financial key ratios for Agilon Health are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 50.5% | – | -1.9% |
| FCF Margin | ROE | ROA |
| -4.0% | -5.8% | -2.2% |
Analysis
GoodWhale has conducted an analysis of AGILON HEALTH‘s fundamentals and based on our Star Chart, AGILON HEALTH has an intermediate health score of 6/10 considering its cashflows and debt. This suggests that the company might be able to pay off debt and fund future operations. Further, we determined that AGILON HEALTH is strong in asset, growth, and weak in dividend, profitability. We classified AGILON HEALTH as a ‘cheetah’, a type of company that has achieved high revenue or earnings growth but is considered less stable due to lower profitability. Given this information, investors who are comfortable with taking on higher risks may find AGILON HEALTH appealing. Such investors could include individual investors who have short-term goals, or institutional investors who are looking for higher returns on their investments. Additionally, AGILON HEALTH may also attract investors who are looking for long-term investments and are willing to wait out periods of lower profitability. More…
Peers
Its competitors include P3 Health Partners Inc, Oak Street Health Inc, and Pathway Health Corp.
– P3 Health Partners Inc ($NASDAQ:PIII)
P3 Health Partners Inc is a US-based healthcare company that provides services and products to health plans, provider groups, and individuals. The company has a market capitalization of 212.47 million as of 2022 and a return on equity of 196.33%. P3 Health Partners Inc is a leading provider of healthcare services and products in the United States. The company offers a wide range of services and products, including health insurance, provider services, and individual products. P3 Health Partners Inc is a publicly traded company listed on the New York Stock Exchange.
– Oak Street Health Inc ($NYSE:OSH)
Oak Street Health Inc is a healthcare services company that operates primary care centers for adults on Medicare in the United States. As of December 31, 2020, the company operated 109 primary care centers in Illinois, Indiana, Michigan, New Jersey, Pennsylvania, and Rhode Island. The company was founded in 2013 and is headquartered in Chicago, Illinois.
– Pathway Health Corp ($TSXV:PHC)
Pathway Health Corp has a market cap of 4.69M as of 2022, a Return on Equity of -239.69%. The company provides healthcare services to skilled nursing and assisted living facilities.
Summary
Investors in Agilon Health are advised to exercise caution as sentiment on the stock has been recently downgraded by Deutsche Bank, which has cited overly optimistic targets as a concern. This has been reflected in the market price, with the stock declining on the same day of the downgrade. Investors should consider the fact that Agilon Health is a newly public company, with a high level of risk and volatility associated with it. It is important to assess the company’s financials, including their sales outlook and balance sheet, before making any decisions.
Additionally, investors should research the competition in the healthcare services space to determine whether Agilon Health is well-positioned to gain market share. Ultimately, with potential rewards come potential risks, and investors should weigh both carefully before making any investment decisions regarding Agilon Health.
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