Owens & Minor: Hold Rating Amid Mixed Performance and Strategic Uncertainties

In a report released on May 8, Michael Cherny from Leerink Partners maintained a Hold rating on Owens & Minor (OMI – Research Report), with a price target of $10.00.

Michael Cherny has given his Hold rating due to a combination of factors that reflect both positive and negative aspects of Owens & Minor’s recent performance. On the positive side, the Patient Direct segment showed improved profitability, and the company’s adjusted EBITDA exceeded expectations. However, the Products & Healthcare Services segment underperformed, with both revenue and EBIT falling short of projections, which tempered the overall results.
Additionally, while the company’s earnings per share were in line with estimates and benefited from a favorable tax rate, the total revenue was slightly below expectations. The ongoing discussions about potentially selling the P&HS segment and the integration of the Rotech acquisition add an element of uncertainty. Despite these challenges, the reaffirmation of the fiscal year guidance suggests stability, but the mixed results and strategic uncertainties justify a cautious Hold rating.

Based on the recent corporate insider activity of 42 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of OMI in relation to earlier this year.