Medline, Inc. Class A: Leveraging a ‘Costco of Healthcare’ Model for Visible Growth, Margin Expansion, and Upside Potential

Medline, Inc. Class A (MDLN) has received a new Buy rating, initiated by Bernstein analyst, Lee Hambright.

Lee Hambright has given his Buy rating due to a combination of factors tied to Medline’s distinctive business model and growth outlook. He highlights how Medline operates much like a “Costco of healthcare,” using its Supply Chain Solutions arm to become a trusted partner to hospitals and then systematically converting that volume into higher-margin Medline-branded products. This transition allows providers to lower their spending while Medline significantly lifts profitability, creating a mutually beneficial dynamic that reinforces long-term customer relationships. In his view, this model, coupled with a large addressable market, supports durable earnings expansion beyond the near term.
Hambright also points to unusually clear visibility into high single-digit to low double-digit revenue growth over the next several years, supported by a substantial backlog of recently signed contracts that will convert into recognized revenue with a lag. He notes that Medline is gaining share as rivals struggle with the complexity of large-scale, next-day medical-surgical distribution, enabling the company to capture an outsized portion of new contracts coming to market. On valuation, his $49 price target is based on applying a 19x EV/EBITDA multiple to his 2027 adjusted EBITDA estimate, and he argues that current trading levels, even after a strong post-IPO performance, still leave meaningful upside. Taken together—strong visibility into growth, expanding margins, competitive momentum, and a still-attractive valuation—support his Outperform (Buy) recommendation on Medline, Inc. Class A.

According to TipRanks, Hambright is a 4-star analyst with an average return of 7.5% and a 64.84% success rate. Hambright covers the Healthcare sector, focusing on stocks such as Abbott Laboratories, Dexcom, and Insulet.

In another report released today, BMO Capital also initiated coverage with a Buy rating on the stock with a $45.00 price target.