DaVita Stock Up Following Q4 Earnings & Revenue Beat, Margins Expand

Core Insights - DaVita Inc. (DVA) reported adjusted earnings per share (EPS) of $3.40 for Q4 2025, a 51.8% increase year over year, exceeding the Zacks Consensus Estimate by 5.1% [1] - The company's total revenues for Q4 2025 reached $3.62 billion, reflecting a 9.9% year-over-year increase and surpassing the Zacks Consensus Estimate by 2.7% [2] - Full-year adjusted EPS was $10.78, marking an 11.4% increase from the previous year, also beating the Zacks Consensus Estimate by 0.7% [1][4] Revenue Analysis - Revenue per treatment (RPT) in Q4 2025 was $422.6 million, up 6.8% year over year and 2.9% sequentially, driven by resolution of aged receivables and improved yield [3] - Full-year revenues totaled $13.64 billion, a 6.5% improvement from the prior year, exceeding the Zacks Consensus Estimate by 0.7% [4] Segment Performance - Dialysis patient service revenues were $3.39 billion in Q4 2025, an 8.9% increase year over year, while other revenues reached $220.6 million, up 25.7% from the previous year [5] Treatment Volume and Patient Base - DaVita provided dialysis services to approximately 295,000 patients across 3,242 outpatient dialysis centers as of December 31, 2025 [6] - Total U.S. dialysis treatments for Q4 were 7,264,520, averaging 91,608 per day, which represents a slight sequential decrease of 0.1% [6] Financial Metrics - Gross profit for Q4 increased by 13.2% year over year to $1.21 billion, with gross margin expanding by 98 basis points to 33.4% [9] - Adjusted operating profit totaled $737.9 million, reflecting a 12.7% increase from the prior year, with adjusted operating margin expanding to 20.4% [11] Cash Flow and Debt - DaVita ended Q4 2025 with cash and cash equivalents of $700.7 million, a slight decrease from $736.5 million at the end of Q3 [12] - Total debt at the end of Q4 was $10.27 billion, up from $10.25 billion at the end of Q3 [12] Share Repurchase - During Q4 2025, DaVita repurchased 2.7 million shares for $331 million, with an additional 1.7 million shares repurchased for $200 million from January 1 to February 2, 2026 [13] Guidance - For 2026, DaVita expects RPT growth of 1%-2% and adjusted EPS in the range of $13.60-$15.00, with the Zacks Consensus Estimate currently at $12.89 [14] Strategic Initiatives - DaVita announced a strategic clinical partnership with Elara Caring to enhance its end-stage kidney disease offerings, aiming to reduce hospitalizations and improve patient experience [16]