Option Care Health (NASDAQ:OPCH) Shares Gap Up - Still a Buy?

Key Points

• McKesson and CD&R agreed to acquire Option Care Health for $32.05 per share in an all-cash deal valuing the company at approximately $5.8 billion, a roughly 37% premium to its prior close. The announcement drove OPCH shares from $23.37 to about $31, near but below the offer price.
• The acquisition still requires customary approvals and closing conditions, while an investor investigation by Brodsky & Smith introduces additional legal and reputational uncertainty. The discount to the offer price likely reflects transaction-completion risk.
• Before the takeover announcement, analyst sentiment was moderately positive, with a consensus “Moderate Buy” rating and an average target of $29.92; the company had also recently exceeded quarterly earnings and revenue estimates.

Option Care Health, Inc. (NASDAQ:OPCH - Get Free Report) gapped up prior to trading on Tuesday. The stock had previously closed at $23.37, but opened at $31.04. Option Care Health shares last traded at $31.0250, with a volume of 22,664,453 shares.

More Option Care Health News

Here are the key news stories impacting Option Care Health this week:

• Positive Sentiment: McKesson and CD&R agreed to acquire Option Care Health for $32.05 per share, implying an enterprise value of approximately $5.8 billion and a premium of about 37% to the prior closing price. The all-cash transaction provides a clear takeover valuation and is the primary reason for the stock’s move higher. CD&R and McKesson Corporation Sign Agreement to Acquire Option Care Health
• Positive Sentiment: Reports that acquisition discussions had reached an advanced stage, followed by the definitive agreement, triggered substantial investor interest and temporarily halted OPCH trading pending news. Option Care Health’s Shares Soar as Acquisition Talks Advance
• Neutral Sentiment: The deal remains subject to customary closing conditions and approvals. The stock’s trading level below the $32.05 offer price suggests investors may be accounting for transaction-completion risk.
• Neutral Sentiment: A Zacks article reviews whether OPCH is undervalued using value, growth, momentum and earnings-estimate trends, but the available report excerpt does not provide a definitive rating or new company-specific catalyst. Is Option Care Health Stock Undervalued Right Now?
• Negative Sentiment: Brodsky & Smith announced an investor investigation involving Option Care Health. The notice provides few details, but such investigations can introduce legal and reputational uncertainty around the transaction. Brodsky & Smith Shareholder Update

Wall Street Analysts Forecast Growth

OPCH has been the topic of several recent research reports. Stephens reissued an "equal weight" rating and issued a $24.00 price target (down from $30.00) on shares of Option Care Health in a research note on Friday, July 17th. Citigroup reiterated a "market outperform" rating on shares of Option Care Health in a report on Tuesday. Wall Street Zen raised Option Care Health from a "hold" rating to a "buy" rating in a research report on Saturday, August 1st. Deutsche Bank Aktiengesellschaft restated a "hold" rating and issued a $24.00 target price (down from $26.00) on shares of Option Care Health in a research note on Thursday, July 30th. Finally, Zacks Research raised Option Care Health from a "strong sell" rating to a "hold" rating in a research report on Monday, July 6th. Seven analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the company presently has an average rating of "Moderate Buy" and an average price target of $29.92.

Option Care Health Stock Performance

The company has a quick ratio of 0.98, a current ratio of 1.47 and a debt-to-equity ratio of 0.91. The stock has a 50 day simple moving average of $23.61 and a two-hundred day simple moving average of $23.54. The stock has a market capitalization of $4.64 billion, a P/E ratio of 23.31, a P/E/G ratio of 1.30 and a beta of 0.58.

Option Care Health (NASDAQ:OPCH - Get Free Report) last announced its quarterly earnings data on Wednesday, July 29th. The company reported $0.45 EPS for the quarter, beating analysts' consensus estimates of $0.43 by $0.02. The company had revenue of $1.44 billion during the quarter, compared to the consensus estimate of $1.42 billion. Option Care Health had a net margin of 3.68% and a return on equity of 18.74%. The company's quarterly revenue was up 1.9% on a year-over-year basis. During the same quarter last year, the firm posted $0.41 EPS. Option Care Health has set its FY 2026 guidance at 1.850-1.920 EPS. On average, equities analysts forecast that Option Care Health, Inc. will post 1.7 EPS for the current fiscal year.

Hedge Funds Weigh In On Option Care Health

Several institutional investors and hedge funds have recently modified their holdings of OPCH. Central Pacific Bank Trust Division grew its position in shares of Option Care Health by 3.9% during the 3rd quarter. Central Pacific Bank Trust Division now owns 14,369 shares of the company's stock worth $323,000 after purchasing an additional 540 shares in the last quarter. Engineers Gate Manager LP grew its position in Option Care Health by 263.0% during the second quarter. Engineers Gate Manager LP now owns 43,560 shares of the company's stock worth $913,000 after buying an additional 31,561 shares in the last quarter. Squarepoint Ops LLC grew its position in Option Care Health by 234.1% during the second quarter. Squarepoint Ops LLC now owns 434,408 shares of the company's stock worth $9,110,000 after buying an additional 304,376 shares in the last quarter. Empirical Finance LLC bought a new position in Option Care Health during the 2nd quarter worth $595,000. Finally, Nykredit A S acquired a new position in Option Care Health in the 2nd quarter valued at $56,000. 98.05% of the stock is currently owned by institutional investors and hedge funds.

About Option Care Health

Option Care Health, Inc NASDAQ: OPCH is a provider of home and alternate-site infusion services in the United States. The company works with patients, physicians, hospitals, health plans and pharmaceutical manufacturers to deliver and manage infusion therapy outside traditional hospital settings, including in patients' homes, ambulatory infusion suites and other community-based locations.

Its services include the provision and administration of specialty medications and other infusion therapies for conditions such as infections, immune disorders, chronic diseases and nutritional deficiencies.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.