DaVita Earnings: Strong Start to 2024, but Cash Flow Prospects Unchanged

Narrow-moat DaVita turned in strong first-quarter results, and management mildly bumped up its bottom-line expectations, including recent share repurchases that we suspect were value-neutral for long-term shareholders. However, its free cash flow guidance hasn't changed. Since free cash flow is the main driver of our valuation methodology and our 2024 assumption for free cash flow remains within management's guidance range, we don't anticipate changing our $122 fair value estimate, at first glance.