Evolent Health (EVH) has received a new Buy rating, initiated by BMO Capital analyst, .
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BMO Capital has given its Buy rating due to a combination of factors that indicate a promising future for Evolent Health. The company has strategically managed to stabilize its operations after facing unexpected challenges in the healthcare sector, such as increased medical costs and data issues. By narrowing risk corridors and securing over $750 million in new business, alongside a $650 million sales pipeline, Evolent Health is positioned for substantial EBITDA growth in the long term.
BMO Capital’s rating is also influenced by Evolent Health’s proactive measures to mitigate future earnings volatility. The company has restructured a significant portion of its risk contracts, providing increased protection against higher costs and data discrepancies. Additionally, the growing demand for Evolent’s solutions, coupled with their AI investments, supports a robust revenue outlook and a projected 20%+ EBITDA growth beyond 2026. These strategic initiatives, along with the company’s focus on consistent execution, underpin BMO Capital’s optimistic outlook for Evolent Health’s stock.
In another report released today, Oppenheimer also maintained a Buy rating on the stock with a $12.00 price target.