Update shared on15 Aug 2025
Owens & Minor's price target was maintained at $6.28 as weak Q2 results and the potential divestiture of its hospital distribution business drove concerns about near-term performance and revenue outlook, although some analysts note Patient Direct strength and believe the recent selloff may be overdone.
Analyst Commentary
- Recent Q2 results and updated outlook were disappointing, leading to reduced price targets and concerns about near-term performance.
- Bearish analysts anticipate a near-term divestiture of the Product and Healthcare Services hospital distribution business, lowering future revenue estimates and reflecting concerns over segment removal and slower Patient Direct growth.
- Bullish analysts view the selloff after the suspected Kaiser contract loss as overdone, noting strength in the core Patient Direct business and potential for significant cash tax benefits related to legislative changes.
- The termination of the Rotech merger is seen as positive, allowing Owens & Minor to refocus on core operations and strategic priorities, despite prior surprises regarding the deal's competitive implications.
- There is consensus that achieving a sustainable turnaround will require a careful balance of cost reduction, working capital improvements, de-leveraging, and continued investment in growth initiatives.
What's in the News
- Owens & Minor is actively seeking acquisitions to strengthen its Patient Direct business and maintain its leadership in the home-based care market.
- The company dropped from multiple Russell Growth indexes, including the Russell 2000 Growth, Russell 2500 Growth, Russell 3000 Growth, and related small cap and composite growth benchmarks.
Valuation Changes
Summary of Valuation Changes for Owens & Minor
- The Consensus Analyst Price Target remained effectively unchanged, at $6.28.
- The Net Profit Margin for Owens & Minor remained effectively unchanged, at 0.52%.
- The Consensus Revenue Growth forecasts for Owens & Minor remained effectively unchanged, at -28.7% per annum.
Disclaimer
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