- Following three straight sessions of gains, the shares of Oak Street Health Inc. ( NYSE: OSH ), an operator of primary care centers for Medicare beneficiaries, fell on Monday after Goldman Sachs downgraded the company to Neutral from Buy, citing uncertain growth prospects.
- The analysts Jamie Perse and the team also lowered the OSH price target to $29 from $32 per share, pointing to a cautious outlook due to growth profitability constraints.
- The team wrote that the company’s current growth rate of adding 20 – 30 centers annually in 2023 and beyond is likely to require “more cash than is currently available, and we expect lack of visibility on this to be an overhang.”
- The downgrade comes amid speculation that health services companies such as OSH could be the next M&A targets after Amazon ( AMZN ) agreed to acquire membership-based primary care platform One Medical ( ONEM ) in July for nearly $3.9B.
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Oak Street Health downgraded at Goldman Sachs citing cloudy outlook