On Thursday, Truist Securities revised its price target for agilon health Inc (NYSE:AGL), decreasing it to $7.50 from the previous target of $10.00. The firm maintained its Hold rating on the healthcare company's stock.
The adjustment follows a review of agilon health's updated cost trend expectations and outlook for 2024, as well as its fourth-quarter results. Truist Securities has updated its revenue estimates for agilon health for fiscal years 2024 and 2025 to $6.43 billion and $7.64 billion, respectively. These figures are slightly up from the former projections of $6.41 billion for FY24 and $7.31 billion for FY25.
However, the firm's adjusted EBITDA estimates took a downward turn, with forecasts now standing at negative $54 million for FY24 and negative $8 million for FY25. These estimates contrast with the previous EBITDA projections of $42 million for FY24 and $99 million for FY25.
The new price target of $7.50 is based on the healthcare company's shares trading at approximately 18 times the reduced 2030 EBITDA estimates, with the multiplier remaining unchanged. The price target also factors in the discounting back method applied by Truist Securities.
The revised financial outlook and price target reflect the latest available data from agilon health, as the company navigates through its financial trajectory heading into the next few years.
InvestingPro Insights
As agilon health Inc (NYSE:AGL) faces a revised price target from Truist Securities, it's important to consider additional metrics and insights that could provide a more rounded perspective on the company's current financial standing. According to InvestingPro data, agilon health has a market capitalization of approximately $2.58 billion, which is a significant figure that reflects the company's size and market presence.
The company's recent performance shows a remarkable revenue growth of 59.38% in the last twelve months as of Q4 2023, indicating that despite some challenges, agilon health is expanding its top-line earnings. Nevertheless, the company's profitability is called into question with a negative adjusted price-to-earnings (P/E) ratio of -29.09, suggesting that investors are currently facing losses.
Two InvestingPro Tips that are pertinent to the current discussion include the fact that management has been aggressively buying back shares, which could signal confidence in the company's future prospects. Additionally, agilon health holds more cash than debt on its balance sheet, providing a cushion that could be advantageous in managing its financial health. For those looking for a deeper dive into the company's potential, InvestingPro offers 19 additional tips that could guide investment decisions. Subscribers can access these tips and more detailed analysis by visiting https://www.investing.com/pro/AGL.
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While analysts do not anticipate agilon health to be profitable this year, and the stock price has experienced significant declines over the last year, these InvestingPro Insights may help investors to better understand the company's financial landscape and make more informed decisions.
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