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DENVER - DaVita Inc. (NYSE: DVA), a leading health care provider specializing in kidney care with a market capitalization of $10.94 billion and annual revenue of $12.97 billion, has initiated a private offering of senior notes to raise $750 million, the company disclosed today. The notes, due in 2033, are subject to market conditions and other factors.
The proceeds from the sale of the 2033 notes are earmarked for the repayment of existing debts under DaVita’s revolving credit facility, including accrued interest. Additionally, funds will cover costs associated with this transaction. Any remaining capital will be directed towards general corporate uses such as capital stock repurchases, working capital, and capital expenditures. According to InvestingPro data, management has been actively buying back shares, contributing to a high shareholder yield, with the company maintaining a healthy free cash flow yield of 16%.
This offering is targeted at qualified institutional buyers as per Rule 144A of the Securities Act of 1933, and to certain non-U.S. persons in accordance with Regulation S under the same act. The notes will not be registered under the Securities Act or any state securities laws, and they will not be offered or sold in the U.S. without registration or an exemption from registration requirements.
DaVita has been a prominent figure in clinical quality and innovation in kidney care for over two decades. The company provides comprehensive care for patients at various stages of kidney disease, from early intervention to support for transplantation and home dialysis. Trading at a P/E ratio of 13.94 and showing strong financial health with an InvestingPro Overall Score of "GREAT," DaVita appears slightly undervalued based on InvestingPro’s Fair Value analysis. Discover 6 more exclusive InvestingPro Tips and comprehensive financial analysis in the Pro Research Report, available with an InvestingPro subscription.
The announcement includes forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ materially. These statements are based on current expectations and assumptions regarding the offering and the anticipated use of net proceeds.
The information in this article is based on a press release statement from DaVita Inc. and does not constitute an offer to sell or a solicitation of an offer to buy the 2033 notes. There will be no sale of these notes in any jurisdiction where such an offer, solicitation, or sale would be unlawful.
In other recent news, DaVita HealthCare Partners Inc. reported its first-quarter earnings for 2025, surpassing analysts’ expectations with an adjusted earnings per share (EPS) of $2.00, compared to a forecast of $1.96. The company also reported revenue of $3.22 billion, slightly exceeding the projected $3.20 billion. Despite these positive results, DaVita experienced significant operational challenges, including a cybersecurity incident and a severe flu season, which contributed to a decline in U.S. treatments per day by 40 basis points. The company has maintained its full-year guidance for adjusted operating income and EPS, indicating confidence in its strategic direction.
TD Cowen recently downgraded DaVita’s price target from $165 to $157 while maintaining a Hold rating, following the company’s first-quarter results that fell short of adjusted EBIT expectations. The revision was attributed to increased flu cases and weather-related impacts. Additionally, DaVita has revised its full-year 2025 volume expectations downward by 50 basis points due to flu-related census declines and a cyber incident. Despite these challenges, DaVita reaffirmed its full-year guidance for EBIT, EPS, and free cash flow.
The company’s international operations, particularly in Latin America, showed strong performance, and DaVita repurchased $680 million in stock, demonstrating a commitment to shareholder value. The company anticipates increased debt expenses of approximately $145 million per quarter and expects profitability from phosphate binders to reach the upper end of previous guidance. These developments reflect DaVita’s resilience amid external challenges, with the company continuing to focus on delivering life-sustaining care and returning value to shareholders.
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