Barrington analyst Michael Petusky maintained a Buy rating on Tivity Health Inc (TVTY) today and set a price target of $40. The company’s shares closed yesterday at $16.54, close to its 52-week low of $14.84.
Petusky noted:
“We are maintaining our OUTPERFORM investment rating on TVTY and our price target remains $40. We arrive at our price target by attaching a 12x multiple to our 2020 adjusted EBITDA estimate. We assume approximately $1 billion in net debt 12 months from now. While we understand the skepticism surrounding the merger and the concerns regarding the debt that was taken on to do the deal, TVTY shares are now trading at 8x our estimate for FY/19 (EV/EBITDA) and 7.5x our estimate for FY/20 (EV/EBITDA). TVTY shares simply seem way too cheap at current levels (especially given the positive update just provided for the healthcare business through at least FY/20).”
According to TipRanks.com, Petusky is a 3-star analyst with an average return of 2.5% and a 45.5% success rate. Petusky covers the Healthcare sector, focusing on stocks such as Anika Therapeutics Inc, Varian Medical Systems, and Merit Medical Systems.
Tivity Health Inc has an analyst consensus of Strong Buy, with a price target consensus of $33.67, representing a 103.6% upside. In a report released today, Piper Jaffray also reiterated a Buy rating on the stock with a $25 price target.
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Based on Tivity Health Inc’s latest earnings release for the quarter ending March 31, the company reported a quarterly net profit of $4.21 million. In comparison, last year the company had a net profit of $22.28 million.
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Tivity Health, Inc. engages in the development and provision of network solutions and health management services. It offers rehabilitative therapy, chiropractic procedure, alternative medicines, and health and fitness programs under the SilverSneakers, Prime Fitness, and WholeHealth Living trademarks.
