Medical Facilities (DR) AI Stock Analysis

• Market Cap: C$295.13M
• Dividend Yield: 2.35%
• Average Volume (3M): 28.55K
• Price to Earnings (P/E): 10.7
• Beta (1Y): 0.51
• Revenue Growth: -40.05%
• EPS Growth: 558.77%
• Country: CA
• Employees: 1,721
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Care Facilities
• EPS (TTM): 0.21
• Shares Outstanding: 17,651,450
• 10 Day Avg. Volume: 25,496
• 30 Day Avg. Volume: 28,554
• PEG Ratio: 1.83
• Price to Book (P/B): 2.99
• Price to Sales (P/S): 0.87
• P/FCF Ratio: 5.49
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$16.97
• Price Target Upside: 1.48% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 1.16
• Revenue Forecast (FY): C$255.85M

• Rating: 67 Neutral
• Price Target: C$18.00 ▲(7.66% Upside)
• Action: Downgraded Date: 03/14/26
• Date: Action: Downgraded 03/14/26

The score is driven primarily by decent financial performance supported by strong historical cash generation and improving leverage, tempered by revenue/profitability volatility and a 2025 cash flow decline. Technicals are mildly positive with neutral momentum, and valuation is supportive due to a moderate P/E and a modest dividend yield.

Positive Factors

Consistent cash generation

Consistently positive operating and free cash flow provides durable internal funding for maintenance capex, distributions and debt service. That cash-flow foundation lowers refinancing risk, supports steady capital allocation and gives management flexibility through reimbursement cycles.

Improving leverage profile

A materially improved debt-to-equity reduces financial risk and interest burden, increasing resilience to operational swings. Lower leverage enhances strategic optionality for tuck-in investments, dividend sustainability and capital spending without overly relying on market financing.

Strong operating margins in latest year

An ~18% operating margin indicates meaningful operating leverage in hospital interests and the ability to convert patient-service revenue to profit. Sustained margin recovery points to efficient cost management and suggests the business can generate lasting earnings power when volumes normalize.

Negative Factors

Revenue and profit volatility

Material year-to-year swings in revenue and margins reflect vulnerability to patient volumes, payer mix and reimbursement variability. That volatility makes forecasting cash flows and dividends harder, increases earnings risk and limits visibility for multi-month capital planning.

Sharp free-cash-flow decline in 2025

A pronounced drop in free cash flow reduces the buffer that funds operations, capital needs and distributions. If sustained, the decline could force tougher allocation choices, pressuring investments or payouts and weakening the company’s ability to absorb reimbursement or volume shocks.

Shrinking capital base and volatile returns

Declining equity and assets suggest potential asset sales, impairments or retained-loss pressure, reducing growth optionality and resiliency. Coupled with volatile ROE, it raises concerns about earnings quality and the sustainability of recent profit improvements.

Medical Facilities Business Overview & Revenue Model

Company Description

Medical Facilities Corporation, through its subsidiaries, owns and operates specialty surgical hospitals and an ambulatory surgery center in the United States. The company's specialty surgical hospitals provide surgical, imaging, diagnostic, and other pain management procedures; and other ancillary services, such as urgent care and occupational health. It also offers ambulatory surgery center, which performs scheduled outpatient surgical procedures. The company was incorporated in 2004 and is headquartered in Toronto, Canada.

How the Company Makes Money

Medical Facilities Corporation generates earnings primarily from the operating results of the hospitals in which it holds ownership interests. Its revenue exposure is therefore tied to patient-service activity at those facilities (e.g., hospital-based care and associated ancillary services), with the company recognizing income based on its share of those entities’ performance and, where applicable, receiving distributions from them. Key factors influencing earnings typically include patient volumes, payer mix, reimbursement rates, and operating costs at the underlying hospitals. Specific facility mix, named partnerships, and the exact breakdown of revenue streams are not available here and are therefore null.

Medical Facilities Financial Statement Overview

Summary

Fundamentals are decent, led by consistently positive operating cash flow and free cash flow (despite a sharp step-down in 2025). The balance sheet is de-risking with improved leverage, but equity/assets declined in 2025 and profitability/revenue have been volatile year to year, limiting the score.

Income Statement

Profitability is mixed but improving in the latest year: 2025 shows solid operating profitability (about 18% operating margin) and a healthy net margin (~8%), rebounding from the 2022 loss and the low-margin 2023 result. That said, the top line has been volatile and recently weak—revenue declined in 2024 and again in 2025 (despite the revenue growth figure shown for 2025), and margins compressed sharply versus 2024’s unusually strong profitability. Overall: good operating earnings power, but less consistent revenue and bottom-line performance year to year.

Balance Sheet

Leverage has improved meaningfully over time, with debt-to-equity moving down from elevated levels in 2022–2023 to a more moderate level in 2024–2025, which reduces financial risk. However, equity and total assets declined notably in 2025 versus prior years, and returns on equity have been highly volatile (very strong in 2024, much lower in other years), suggesting earnings quality and/or one-time factors may be influencing results. Overall: improving balance-sheet risk profile, but with some shrinking capital base and less stable returns.

Cash Flow

Cash generation is a clear strength: operating cash flow and free cash flow are consistently positive across all years provided, and free cash flow has generally tracked net income well. The key weakness is momentum—free cash flow fell sharply in 2025 (negative growth), and cash flow coverage versus accounting earnings weakened in 2025 compared with 2024. Overall: strong cash flow foundation with a recent-year step-down that bears monitoring.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	258.62M	331.53M	445.58M	424.55M	398.63M
Gross Profit	98.20M	219.88M	296.68M	280.63M	268.61M
EBITDA	59.41M	82.57M	72.43M	51.15M	103.40M
Net Income	21.08M	73.49M	18.50M	-4.41M	15.50M
Balance Sheet
Total Assets	272.14M	346.29M	354.88M	377.79M	446.97M
Cash, Cash Equivalents and Short-Term Investments	43.37M	108.50M	24.11M	34.93M	61.04M
Total Debt	58.74M	73.94M	116.81M	142.95M	140.90M
Total Liabilities	171.76M	198.84M	236.58M	263.10M	273.82M
Stockholders Equity	75.32M	122.02M	85.99M	79.13M	127.55M
Cash Flow
Free Cash Flow	40.99M	76.22M	56.66M	50.30M	67.22M
Operating Cash Flow	45.95M	83.28M	72.71M	57.01M	75.64M
Investing Cash Flow	-4.14M	85.42M	-13.67M	-5.78M	-8.69M
Financing Cash Flow	-107.30M	-84.26M	-69.83M	-77.35M	-72.06M

Medical Facilities Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 16.72
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DR, the sentiment is Neutral. The current price of 16.72 is below the 20-day moving average (MA) of 16.97, above the 50-day MA of 16.36, and above the 200-day MA of 15.32, indicating a neutral trend. The MACD of 0.22 indicates Positive momentum. The RSI at 49.24 is Neutral, neither overbought nor oversold. The STOCH value of 56.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:DR.

Medical Facilities Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EXE	70 Outperform	C$2.47B	18.86	47.65%	2.28%	11.59%	41.99%
DR	67 Neutral	C$295.13M	10.68	89.16%	2.35%	-40.05%	558.77%
CRRX	66 Neutral	C$232.12M	9.17	28.24%	1.03%	0.19%	―
SIA	63 Neutral	C$2.27B	42.05	6.93%	4.47%	11.47%	6.45%
WELL	58 Neutral	C$1.07B	78.13	-5.11%	―	26.20%	-156.86%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Medical Facilities Corporate Events

Medical Facilities Corporation Declares C$0.09 First-Quarter Dividend

Medical Facilities Corporation has declared a cash dividend of C$0.09 per common share, payable on April 15, 2026, to shareholders of record as of March 31, 2026. The dividend has been designated as an eligible dividend under Canadian tax law, offering potential tax advantages to Canadian investors and signaling continued capital returns from the company’s U.S. surgical hospital operations.

The announcement underscores the company’s ongoing commitment to returning cash to shareholders while it continues to derive revenue from its two specialty surgical hospitals in Arkansas and South Dakota. By maintaining regular dividend payments, Medical Facilities reinforces its income appeal to investors and highlights the stability of its fee-based business model in the U.S. healthcare services sector.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$17.00 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.

Medical Facilities boosts earnings, sheds assets and accelerates share buybacks

Medical Facilities Corporation reported 2025 facility service revenue of $342.2 million, up 3.2% year over year, with fourth-quarter revenue rising 6.9%. Income from operations for the year increased 6.1% to $58.0 million and adjusted EBITDA grew 3.1% to $73.7 million, driven by a strong fourth quarter that saw double-digit gains in operating income and adjusted EBITDA.

The company advanced its portfolio rationalization by selling its stakes in The Surgery Center of Newport Coast in late 2025 and Oklahoma Spine Hospital in early 2026, generating combined cash proceeds of $47.5 million. It also returned $61.8 million to shareholders through the repurchase of more than 5.1 million common shares and ended the year with $34.2 million in corporate cash, positioning it to consider further share buybacks or distributions as it evaluates deployment of sale proceeds.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$17.00 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.

Medical Facilities to Release 2025 Results and Host Investor Call on March 12

Medical Facilities Corporation said it will publish its fourth quarter and full-year 2025 financial results before markets open on March 12, 2026, with the accompanying financial statements and management discussion to be made available on the company’s website and filed on SEDAR+ the same day. Management will discuss the results on an earnings call and live audio webcast that morning, which will include a question-and-answer session with equity analysts, signaling ongoing engagement with investors and analysts around the company’s performance and outlook.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$17.00 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.

Medical Facilities Sells Major U.S. Spine Hospital Stake, Refocuses on Core Surgical Assets

Medical Facilities Corporation has sold its 63.96% interest in Oklahoma Spine Hospital in Oklahoma City to SSM Health Care of Oklahoma and an entity owned by the hospital’s physician partners for a total of US$46 million, and separately divested The Surgery Center of Newport Coast in California for US$1.5 million. The transactions, which remove a business that contributed roughly a quarter of consolidated facility service revenue and more than one-eighth of operating income in 2024, are positioned by management as a strategic refocusing on core assets and key markets, with the company evaluating options for deploying net proceeds that include share repurchases and direct capital returns to shareholders, potentially reshaping its capital structure and narrowing its U.S. operating footprint.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$16.50 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.

Medical Facilities Sells Major U.S. Assets in Strategic Refocus, Plans Capital Return

Medical Facilities Corporation has sold its 63.96% stake in Oklahoma Spine Hospital in Oklahoma City to SSM Health Care of Oklahoma and an entity owned by OSH’s physician partners for a total of US$46 million, and has also divested its ambulatory surgery center in Newport Beach, California, for US$1.5 million. The transactions, which remove a business that accounted for nearly a quarter of the company’s 2024 facility service revenue, are positioned as part of a strategic shift to focus on core assets while returning capital to shareholders, with the company evaluating options such as share repurchases and direct distributions for the majority of the anticipated net proceeds.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$16.50 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.