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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Option Care Health, Inc. (XNAS:OPCH) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
OPCH
Name:
OPTION CARE HEALTH, INC. (XNAS:OPCH)
Sector:
27.32M
Industry:
Medical Care Facilities
CEO:
Mr. John C. Rademacher
Total Employees:
5,430
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 716.35% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF OPTION CARE HEALTH, INC.(OPCH) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND MEDICAL CARE FACILITIES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
30.55
One Month Price Target:
$30.78
Six Month Price Target :
$31.93
Likely Price in One Year's Time:
Ticker:
$33.32
Likely Trading Range Today Under (Normal Volatility)
$30.42
Price Upper limit ($) :
$30.8
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$28.31
This week:
$25.53
This month :
$20.52
Other Primary facts
Market Cap:
5.77B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
181.86M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.11%
-25.15%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$40.95
$36.08
$20.15
$25.02
Medium risk (<10%) entry points
Buy Call
Sell Call
$34.50
Buy Put:
Sell Put:
$33.46
$26.59
$27.64
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
OPCH
Sharpe Ratio:
5.14%
Comparison:
OPCH, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 131.17% higher than the industry
& ratio is 125.50% higher than the market/S&P 500 average
Average Returns/Yield of
OPCH
Daily returns:
0.20%
Weekly returns:
0.99%
Monthly returns:
3.95%
Yearly returns:
23.01%
Comparison of returns:
Average annual returns/yield (last 3 years) is 106.10% above industry average
Classification:
OPCH, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.31
Statistical test of Returns:
OPCH has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.67%
Weekly Volatility:
8.21%
Monthly Volatility:
16.42%
Yearly Volatility:
56.89%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.73%
Volatility in last five trading days has been -80.24% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.34%
Weekly VaR:
-16.42%
Monthly VaR:
-32.85%
How Much Can the price of
OPCH
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-27%
Worst case (decline):
>85%
This translates to price declining to:
$22.37
This translates to price declining to:
$4.58
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
OPCH is a 131.83% riskier investment compared to the market/S&P 500 & is 98.61% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 10.08% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
OPCH
Beta in relation to market/S&P 500--1.35
Expected beta in 1 year's time:
0.766
Expected beta in 3 year's time:
1.083
Unlevered (debt free) Beta:
0.671
Beta in relation to Nasdaq (XNAS):
0.653
Beta in relation to all global stocks::
0.8
Beta Comparison & Analysis
Beta of competitors/peers::
1.664
Beta is -19.06% lower than peers
Average Industry Beta:
1.067
Beta is 26.22% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
7.86%
Sustainable growth rate is -78.17% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.350
Alpha is 179.24% above industry average alpha yield
Alpha is 2231% higher than market/& is unsustainably high
Analysis of Cost of Capital of
OPCH
Equity cost of capital:
0.124
Equity cost of capital is 18.32% above industry mean WACC
Unlevered (without debt) cost of capital:
6.16%
Before-tax cost of debt:
5.15%
After-tax cost of debt:
4.07%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
4.07%
WACC is 25.99% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$19.77
Revenue growth rate per share of (3Y):
4.55
Annual revenue growth rate is -129.77% below industry average
EPS:
$0.95
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$1.06
-
-
Debt per share
$6.24
EBITDA per share
$1.57
Valuation Analysis Today of
OPCH
P/E Ratio:
31.68
P/E Ratio of Competitors/Peers:
0
- & is -54.98% lower than the industry
Stock price/value with industry average P/E ratio: $66.84
OPCH is -54.30% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
1.55
Price to sales ratio is -27.02% below the industry mean
P/B (Price to book value ratio):
4.55
Price to free cash flow: 28.94
Price to free cash flow ratio is -19.26% lower than the industry
Net income growth rate (3Y):
-148.26%
Net income growth rate is -196.60% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
92.89%
Net debt to equity ratio:
83.00%
Debt to assets ratio:
39.43%
Net debt to assets ratio:
35.23%
Debt-to-asset ratio is -26.95% below industry average
Ability to repay debt:
Interest coverage ratio:
4.79
Interest coverage ratio is -75.95% less than industry average
Looking forward:
Debt growth rate:
3.12%
Annual debt growth is -97% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.13%
Analysis of Key Statistics
Correlation of price movement with the market:
0.356
Statistical significance of correlation:
OPCH has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.432
Stock price is -17.47% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.432
Correlation of price movement with Nasdaq (^IXIC):
-0.01
Covariance of price movement with the market:
-0.02
Kurtosis
8.81
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.946
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
OPCH
Gross Profit Margin Ratio:
91%
Operating Profit Margin Ratio:
5.95%
Operating profit margin is -183.33% lower than the industry
Net Profit Margin Ratio:
91%
Effective Tax Rate:
-8.59%
Effective tax rate is -139.36% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
14.16%
Return on equity (ROE) is -20.60% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
6.01%
Return on assets (ROA) is 37.63% higher than the industry
Financial Leverage:
1.7x
Current Ratio:
1.59
Current ratio is -13.87% below industry average
Cash Conversion Cycle (days):
3.8
Cash conversion cycle is -86.06% below industry average
The remaining useful life of property plant & equipment is: 4.5 years
Stock based compensation to net income ratio:
2.41%
In-depth Efficiency Analysis
Revenue generated per employee:
662.1K
Each employee generates 90% more revenue than industry average revenue per employee
EBITDA generated per employee:
52.7K
Each employee generates -4% less EBITDA than industry average revenue per employee
Profit generated per employee:
31.9K
Each employee generates 9% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
5.0K
Each employee generates -27% less free cash flow than industry average revenue per employee
Assets/Capital per employee
381.7K
Each employee generates -27% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
OPCH
TURNING POINT THERAPEUTICS, INC. (XNAS:TPTX)
ARVINAS, INC. (XNAS:ARVN)
SURGERY PARTNERS, INC. (XNAS:SGRY)
Berkeley Lights Inc (XNAS:BLI)
SMILEDIRECTCLUB, INC. (XNAS:SDC)
HMSY
NANOSTRING TECHNOLOGIES, INC. (XNAS:NSTG)
VERACYTE, INC. (XNAS:VCYT)
BURFORD CAPITAL LIMITED (XNYS:BUR)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
3.60B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
2.78B
815.07M
-
-
539.64M
-
61.44M
601.08M
-
59.77M
67.07M
286.18M
213.99M
173.03M
159.35M
- 13689.00K
173.03M
Statement of Cash Flow
Date:
Period:
15.98M
Differed Income Tax :
13.00M
Stock Based Compensation :
4.18M
Change in Working Capital :
- 34704.00K
Accounts Receivables:
- 28766.00K
Other Working Capital:
- 51754.00K
Other Non-Cash Items:
3.96M
Net Cash Provided by Operating Activities:
32.68M
Investments in PP&E:
- 5359.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
145.60M
-
145.60M
366.29M
217.18M
76.64M
805.71M
183.73M
1.48B
358.55M
-
14.04M
37.75M
2.07B
-
2.88B
356.12M
24.69M
-
-
127.33M
508.14M
1.13B
13.45M
1.15B
-
1.66B
18.00K
70.14M
10.6M
1.14B
March 31, 2022 at 6:00:00 AM
3.38B
1.22B
2.88B
-
1.16B
1.0B
-
-
- 5359.00K
- 1500.00K
-
-
-
355.00K
- 1145.00K
-
26.18M
145.60M
119.42M
32.68M
- 5359.00K
27.32M
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
OPCH
2023
2024
2025
2026
2027
$28.35
$30.91
$33.71
$36.76
$40.09