Medical Facilities (DR) AI Stock Analysis

• Market Cap: C$301.32M
• Dividend Yield: 2.35%
• Average Volume (3M): 28.55K
• Price to Earnings (P/E): 2.4
• 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): 0.31
• Shares Outstanding: 17,755,949
• 10 Day Avg. Volume: 25,496
• 30 Day Avg. Volume: 28,554
• PEG Ratio: 0.07
• Price to Book (P/B): 1.64
• Price to Sales (P/S): 0.61
• P/FCF Ratio: 2.63
• 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$16.96
• Price Target Upside: -0.06% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 1.51
• Revenue Forecast (FY): C$300.13M

• Rating: 76 Outperform
• Price Target: C$19.00 ▲(11.96% Upside)
• Action: Reiterated Date: 02/03/26
• Date: Action: Reiterated 02/03/26

The score is driven primarily by strong financial performance (high margins and strong cash conversion) and very attractive valuation (low P/E with a moderate dividend). Technicals are supportive due to price strength above key moving averages, but mixed momentum indicators limit the upside of the technical component.

Positive Factors

High Profitability and Margins

Sustained high gross, EBITDA and net margins indicate durable pricing power and efficient operations in facility-based care. These margins provide structural resilience to margin compression, support reinvestment in centers and services, and underpin long-term cash generation even with modest revenue growth.

Strong Cash Conversion

Nearly one-to-one conversion of earnings into operating and free cash flow signals reliable cash generation from patient services and facility fees. This durability supports funding of maintenance capex, dividends, and debt reduction without relying on equity raises in the medium term.

Improving Leverage Management

A lower debt-to-equity ratio versus prior levels reflects tangible progress on leverage, reducing refinancing and interest-rate risks. Improved leverage increases financial flexibility to invest in additional ASC capacity or partnerships and strengthens the balance sheet over a multi-quarter horizon.

Negative Factors

Modest Revenue Growth

Revenue expansion is limited, constraining scalable earnings growth and making profitability gains more dependent on margin improvements or cost cuts. Without faster top-line traction or acquisitions, long-term EPS growth may be capped absent material expansion of service volume.

Negative Free Cash Flow Growth

Declining free cash flow growth, even from a high conversion base, can limit the company's ability to fund expansion, repay debt, or increase shareholder distributions. If the trend persists it could force trade-offs between capex, M&A and deleveraging over several quarters.

Low Equity Ratio / Balance Sheet Reliance

A relatively low equity ratio implies a thinner equity cushion and greater reliance on debt or external financing. That structural capital mix can amplify returns but increases vulnerability to operational shocks and could constrain strategic investments if access to debt markets tightens.

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 (DR) generates revenue primarily through patient services, which include fees for surgical procedures, consultations, and outpatient services. The company bills insurance companies, Medicare, and patients directly for these services. Key revenue streams include facility fees, surgeon fees, and anesthesia fees, allowing the company to capitalize on the increasing demand for outpatient surgical procedures. Additionally, Medical Facilities (DR) may engage in partnerships with healthcare providers and insurance companies to offer bundled payment solutions, further enhancing its revenue potential. Cost management and operational efficiencies also play a significant role in maintaining profitability.

Medical Facilities Financial Statement Overview

Summary

Strong profitability and efficiency (gross margin 65.05% TTM; net margin 28.90% TTM; EBITDA margin 26.24% TTM) with solid cash conversion (operating cash flow to net income 0.98 TTM; free cash flow to net income 0.94 TTM). Offsetting factors are modest revenue growth (3.64% TTM) and negative free cash flow growth (-6.56% TTM), plus moderate balance sheet reliance on equity (equity ratio 22.97% TTM).

Income Statement

The company shows a solid gross profit margin of 65.05% TTM, indicating strong control over production costs. The net profit margin has improved significantly to 28.90% TTM, reflecting enhanced profitability. Revenue growth is modest at 3.64% TTM, but the trend is positive compared to previous declines. EBIT and EBITDA margins are healthy at 19.81% and 26.24% TTM, respectively, showing efficient operational management.

Balance Sheet

The debt-to-equity ratio has improved to 0.89 TTM, indicating better leverage management. Return on equity is exceptionally high at 90.38% TTM, driven by strong net income, but this could indicate potential volatility. The equity ratio stands at 22.97% TTM, suggesting moderate reliance on equity financing.

Cash Flow

Operating cash flow to net income ratio is robust at 0.98 TTM, indicating strong cash generation relative to earnings. Free cash flow to net income ratio is also high at 0.94 TTM, reflecting efficient cash management. However, free cash flow growth is negative at -6.56% TTM, which could be a concern if it persists.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	257.36M	331.53M	445.58M	424.55M	398.63M	363.85M
Gross Profit	136.27M	219.88M	296.68M	280.63M	268.61M	242.94M
EBITDA	64.62M	82.57M	72.43M	51.15M	103.40M	96.05M
Net Income	81.33M	73.49M	18.50M	-4.41M	15.50M	8.81M
Balance Sheet
Total Assets	269.49M	346.29M	354.88M	377.79M	446.97M	457.00M
Cash, Cash Equivalents and Short-Term Investments	46.81M	108.50M	24.11M	34.93M	61.04M	66.18M
Total Debt	65.09M	73.94M	116.81M	142.95M	140.90M	161.95M
Total Liabilities	159.40M	198.84M	236.58M	263.10M	273.82M	281.83M
Stockholders Equity	86.13M	122.02M	85.99M	79.13M	127.55M	127.53M
Cash Flow
Free Cash Flow	53.81M	76.22M	56.66M	50.30M	67.22M	79.57M
Operating Cash Flow	58.46M	83.28M	72.71M	57.01M	75.64M	87.09M
Investing Cash Flow	87.84M	85.42M	-13.67M	-5.78M	-8.69M	18.31M
Financing Cash Flow	-118.21M	-84.26M	-69.83M	-77.35M	-72.06M	-71.15M

Medical Facilities Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• 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 Positive. The current price of 16.97 is above the 20-day moving average (MA) of 16.44, above the 50-day MA of 15.99, and above the 200-day MA of 15.21, indicating a bullish trend. The MACD of 0.30 indicates Negative momentum. The RSI at 61.38 is Neutral, neither overbought nor oversold. The STOCH value of 68.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:DR.

Medical Facilities Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DR	76 Outperform	C$301.32M	2.37	39.85%	2.35%	-40.05%	558.77%
EXE	70 Outperform	C$2.50B	23.48	65.57%	2.28%	11.59%	41.99%
SIA	63 Neutral	C$2.33B	48.33	7.07%	4.47%	11.47%	6.45%
CRRX	59 Neutral	C$242.16M	3,810.00	0.11%	1.03%	0.19%	―
WELL	58 Neutral	C$1.07B	-24.18	-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 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.

Medical Facilities Corporation Declares Fourth Quarter Dividend

Medical Facilities Corporation has announced a cash dividend of Cdn $0.09 per common share, payable on January 15, 2026, to shareholders of record as of December 31, 2025. This dividend is designated as an ‘eligible dividend’ under Canadian tax law. The announcement reflects the company’s ongoing commitment to providing value to its shareholders and highlights its stable financial position, which is supported by its portfolio of surgical facilities in the U.S.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$15.50 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.

Medical Facilities Corporation Reports Strong Q3 2025 Financial Results

Medical Facilities Corporation reported a 7.5% increase in facility service revenue for Q3 2025, driven by higher surgical case volumes and favorable payor mix. The company’s income from operations rose by 17.1%, and EBITDA increased by 10.2%, reflecting operational strength. Additionally, MFC returned $5.6 million to shareholders through share buybacks, highlighting its commitment to shareholder value. Despite fluctuations in net income due to non-cash finance costs and income taxes, the company maintains a strong balance sheet with significant cash reserves, indicating a positive outlook for stakeholders.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$15.50 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.

Medical Facilities Corporation Reports Strong Q3 2025 Results

Medical Facilities Corporation reported a 7.5% increase in facility service revenue for the third quarter of 2025, driven by higher surgical case volumes and favorable payor rate changes. The company’s income from operations rose by 17.1%, and EBITDA increased by 10.2%, reflecting the strength of its surgical facilities. Additionally, the company returned $5.6 million to shareholders through share repurchases, indicating a strong financial position and commitment to shareholder value.

The most recent analyst rating on (TSE:DR) stock is a Hold with a C$15.50 price target. To see the full list of analyst forecasts on Medical Facilities stock, see the TSE:DR Stock Forecast page.