P3 Health Partners Inc. (NASDAQ: PIII)

Sector: Healthcare Industry: Medical Care Facilities CIK: 0001832511
Market Cap 11.35 Mn
P/B -0.61
P/E -0.09
P/S 0.01
ROIC (Qtr) -105.50
Div Yield % 0.00
Rev 1y % (Qtr) -4.66
Total Debt (Qtr) 264.96 Mn
Debt/Equity (Qtr) -14.18

About

P3 Health Partners Inc., known by its ticker symbol PIII, is a company that operates in the Medicare market, a sector valued at $944 billion and serving approximately 66 million eligible lives as of October 2023. The company is a player in the population health management industry, with a focus on value-based care (VBC) models. P3 Health Partners Inc. derives its revenue primarily from its P3 Care Model, a patient-centric and physician-led VBC model. This model is designed to deliver high-quality care to patients while driving cost savings for...

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Price action

Investment thesis

Bull case

  • Retained earnings of (575.62M) represent substantial 30.80x of equity (18.69M), indicating strong internal capital generation.
  • Strong free cash flow of (122.87M) provides 8.19x coverage of acquisition spending (15M), indicating disciplined M&A strategy.
  • Cash reserves of 38.46M provide solid 2.66x coverage of other non-current liabilities 14.45M, indicating strong liquidity.

Bear case

  • Cash reserves of 38.46M provide limited coverage of acquisition spending of (15M), which is -2.56x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of (122.75M) shows concerning coverage of stock compensation expenses of 5.20M, with a -23.59 ratio indicating potential earnings quality issues.
  • Free cash flow of (122.87M) provides weak coverage of capital expenditures of 119000, with a -1032.50 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of (122.75M) provides minimal -15.31x coverage of tax expenses of 8.02M, suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Operating earnings of (76.80M) show weak coverage of depreciation charges of 84.32M, with a -0.91 ratio indicating high capital intensity and potential reinvestment needs.

Peer comparison

Companies in the Medical Care Facilities
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 HCA HCA Healthcare, Inc. 114.88 Bn 18.11 1.54 46.35 Bn
2 THC Tenet Healthcare Corp 18.07 Bn 13.34 0.87 13.19 Bn
3 UHS Universal Health Services Inc 14.64 Bn 10.65 0.86 5.11 Bn
4 FMS Fresenius Medical Care AG 14.10 Bn 16.69 0.61 14.98 Bn
5 EHC Encompass Health Corp 12.55 Bn 19.95 2.17 2.66 Bn
6 ENSG Ensign Group, Inc 10.08 Bn 30.72 2.09 2.16 Bn
7 DVA Davita Inc. 8.90 Bn 11.53 0.67 12.78 Bn
8 CHE Chemed Corp 6.38 Bn 22.87 2.52 0.14 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.24 1.26
EV to Cash from Ops. EV/CFO -1.35 12.78
EV to Debt EV to Debt 0.62 12.10
EV to EBIT EV/EBIT -2.15 10.74
EV to EBITDA EV/EBITDA -0.97 16.04
EV to Free Cash Flow [EV/FCF] EV/FCF -1.34 18.02
EV to Market Cap EV to Market Cap 13.98 432.64
EV to Revenue EV/Rev 0.11 2.77
Price to Book Value [P/B] P/B -0.63 -1.92
Price to Earnings [P/E] P/E -0.09 5.13
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.10
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -13.44
Dividend per Basic Share Div per Share (Qtr) 0.00 0.27
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 5.42
Interest Coverage Int. cover (Qtr) -1.66 -97.94
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -156.13 -114.65
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -43.52 65.22
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.97
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 1.54 -46.98
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -6.72 75.97
EBIT Growth (1y) % EBIT 1y % (Qtr) 6.47 -61.19
EBT Growth (1y) % EBT 1y % (Qtr) -21.22 -115.48
EPS Growth (1y) % EPS 1y % (Qtr) -7.92 -24.32
FCF Growth (1y) % FCF 1y % (Qtr) -79.22 309.51
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -13.48 17.88
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 2.11 1.04
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.04
Cash Ratio Cash Ratio (Qtr) 0.09 0.39
Current Ratio Curr Ratio (Qtr) 0.32 1.39
Debt to Equity Ratio Debt/Equity (Qtr) -14.18 -13.19
Interest Cover Ratio Int Coverage (Qtr) -1.66 -97.94
Times Interest Earned Times Interest Earned (Qtr) -1.66 -97.94
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 0.50 -95.81
EBIT Margin % EBIT Margin % (Qtr) -5.31 -94.97
EBT Margin % EBT Margin % (Qtr) -8.51 -105.60
Gross Margin % Gross Margin % (Qtr) -4.10 23.31
Net Profit Margin % Net Margin % (Qtr) -9.10 -106.14