ALHAMBRA, Calif. - Astrana Health, Inc. (NASDAQ: ASTH), a healthcare company integrating technology and provider services, announced today its plans to acquire Collaborative Health Systems (CHS), a Centene Corporation (NYSE:CNC) subsidiary. The move aims to expand Astrana's care delivery capabilities and strengthen its provider network.
CHS operates as a management services organization and currently serves over 129,000 beneficiaries across 17 states. The acquisition is expected to enhance Astrana's reach, particularly in key markets such as Connecticut, Georgia, Maryland, New Mexico, Virginia, and Texas, where CHS has established a significant presence with more than 350 primary care physicians.
Brandon Sim, President and CEO of Astrana Health, believes the integration of CHS's provider base and payer partnerships with Astrana's technology platform will accelerate the company's mission to empower providers and improve patient care nationwide. Astrana's Care Enablement platform, which includes AI-driven analytics and other care management tools, is anticipated to drive improvements in patient outcomes post-acquisition.
Sarah Baiocchi, Senior Vice President of Clinical and Specialty Services at Centene, expressed confidence in Astrana's ability to support CHS's growth and continue the collaboration with Centene's Medicare business, Wellcare, to deliver affordable, high-quality care.
The transaction is slated for completion by the end of the year, subject to customary regulatory approvals. Astrana will update its financial outlook for the combined entity following the closure of the deal. The acquisition details will be further discussed in Astrana's upcoming quarterly earnings presentation on August 7.
Astrana Health, headquartered in Alhambra, California, serves over 10,000 providers and 1.0 million Americans in value-based care arrangements. The company's integrated healthcare delivery platform is designed to support providers in value-based care models, enabling cost-effective, high-quality care.
This news article is based on a press release statement from Astrana Health, Inc.
In other recent news, Astrana Health, Inc. has initiated the process for the resale of Earn-Out Shares linked to its acquisition of Asian American Medical Group (AAMG), which is contingent on AAMG achieving certain performance milestones. This will allow former AAMG stockholders to potentially sell shares they are entitled to upon meeting specified targets.
The company has also been garnering positive attention from financial firms Truist Securities and Stifel. Truist Securities upgraded Astrana Health's stock rating from Hold to Buy and raised the price target to $50.00, based on the company's strong performance and its ability to meet demand within the value-based care industry.
Similarly, Stifel raised its price target for Astrana Health to $48, maintaining a Buy rating, after meeting with the company's management. This decision was influenced by Astrana Health's expansion strategies beyond California and its robust merger and acquisition pipeline.
These recent developments suggest a promising outlook for Astrana Health's future financial performance.
InvestingPro Insights
In light of Astrana Health's recent announcement to acquire Collaborative Health Systems, investors and industry observers are closely monitoring the company's financial health and market performance. According to InvestingPro data, Astrana Health, Inc. (NASDAQ: ASTH) has a market capitalization of $2.29 billion and is trading at a P/E ratio of 38.49, reflecting a high earnings multiple that suggests investors have high expectations for future earnings growth.
The company's revenue growth has been robust, with the latest data showing a 19.34% increase over the last twelve months as of Q1 2024. This is further supported by a quarterly revenue growth of 19.9% in Q1 2024, indicating sustained momentum in the company's financial performance. Additionally, Astrana Health has demonstrated strong returns, with a 27.67% price total return over the last month and a 38.07% return over the last three months, signaling investor confidence in the company's strategic initiatives and growth prospects.
InvestingPro Tips suggest that Astrana Health operates with a moderate level of debt, which could provide it with financial flexibility to pursue growth opportunities such as the CHS acquisition. Moreover, analysts predict the company will be profitable this year, and the firm has been profitable over the last twelve months, reinforcing its financial stability as it embarks on this expansion.
For investors seeking more detailed analysis and additional insights, there are 10 more InvestingPro Tips available at https://www.investing.com/pro/ASTH. Plus, interested readers can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, unlocking a wealth of data and expert analysis to inform their investment decisions.
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