Astrana Health (ASTH) has received a new Buy rating, initiated by Needham analyst, Matthew Shea.
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Matthew Shea has given his Buy rating due to a combination of factors influencing Astrana Health’s (ASTH) market position and growth potential. The company is currently at a pivotal moment in its value-based care (VBC) performance, benefiting from increased reimbursement rates and greater utilization. This positions Astrana Health to capitalize on full risk deals more aggressively than its peers, which could drive significant long-term growth of 20%-30% or more.
Additionally, Astrana Health’s care model has demonstrated resilience in challenging macroeconomic conditions, suggesting potential for EBITDA margin expansion as the market environment improves. Despite these strengths, the stock is trading at a relatively low multiple compared to hospital operators, which Shea views as a baseline valuation. Given Astrana Health’s strong financial profile and potential catalysts, Shea believes the stock should be valued at least on par with its peers, justifying the Buy rating.