OPCH Stock Forecast & Price Target

Option Care Health Inc. demonstrated strong financial performance with an 8% year-over-year increase in gross profit, reaching $269.0 million, exceeding estimates. Additionally, the chronic therapy segment experienced over 10% growth, contributing to a positive trajectory for the company's business segments. The upward revision of the 2025 revenue estimate to $5.61 billion, representing a 12% year-over-year growth, along with increased financial guidance for the fiscal year 2025, further underscores the company's robust outlook.

Option Care Health Inc faces several headwinds that contribute to a negative outlook for its stock, including the significant reliance on a major customer that constitutes 14% of its 2023 revenue, presenting a risk to future profitability if this customer is lost. Furthermore, the company's management has estimated a gross profit headwind of over $20 million in relation to Stelara for the quarter, which is expected to impact annual guidance by $65-70 million, complicating their operational leverage recovery. Additionally, challenges to gross margin expansion are evident, as the growth of lower-margin chronic therapies outpaces that of higher-margin acute therapies, potentially hindering future EBITDA margin improvements.