Here's Why You Should Hold DaVita Stock in Your Portfolio for Now

DaVita Inc. DVA has been gaining from its business model. The optimism, led by a decent third-quarter 2025 performance and the overseas growth, is expected to contribute further. However, concerns regarding its dependence on commercial payers persist.So far this year, this Zacks Rank #3 (Hold) stock has lost 24.9% against the industry's 11.2% growth and the S&P 500's 12.9% increase.The renowned global comprehensive kidney care provider has a market capitalization of $7.39 billion. The company projects 12.6% growth for the next five years and expects to maintain its strong performance going forward. DaVita’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed once, the average surprise being 0.3%.Image Source: Zacks Investment ResearchUpsidesBusiness Model: DaVita’s patient-centric model integrates a broad kidney care platform to expand patient choice across care settings and treatment modalities. As value-based arrangements gain traction in kidney care, collaboration among nephrologists, providers and transplant programs is deepening, enabling better care coordination and earlier clinical intervention. DaVita’s Integrated Kidney Care business actively participates in CMMI’s Comprehensive Kidney Care Contracting model, which focuses on managing late-stage CKD and ESKD patients to slow disease progression, increase home dialysis adoption and encourage transplants.The company also operates dialysis centers through joint ventures in which it typically holds controlling stakes, while partners such as nephrologists, hospitals and other healthcare providers own minority interests. Many of DaVita’s outpatient centers support home hemodialysis and peritoneal dialysis, helping eligible patients receive treatment at home.Overseas Growth: DaVita is steadily expanding in the international markets. In the past few years, the company has strengthened its position in the emerging and developing markets of Brazil, China, Colombia, Germany, India, Malaysia, the Netherlands, Poland, Portugal and Saudi Arabia through strategic alliances and acquisitions of dialysis centers. These are expected to help DaVita deliver more efficient patient care.Currently, DaVita is seeking to expand in major European and Asian countries via acquisitions and partnerships. In 2025, management expects operating growth in the company’s international business as it continues expansion in international markets.As of Sept. 30, 2025, DaVita provided dialysis services to around 293,200 patients at 3,247 outpatient dialysis centers, of which 2,662 were U.S. centers while 585 were located across 14 other countries. During the third quarter of 2025, the company opened three dialysis centers in the United States. It also acquired 58 dialysis centers outside the United States in the same period.Mixed Q3 Results: DaVita ended the third quarter of 2025 with mixed results. The uptick in the company’s top line and revenue per treatment was encouraging. The per-day increase in total U.S. dialysis treatments for the third quarter on a sequential basis and solid revenues from dialysis patient service were encouraging. The opening of dialysis centers within the United States and the acquisition of centers overseas were promising.However, the year-over-year decline in the bottom line and normalized non-acquired treatment was disappointing.DownsidesDependence on Commercial Payers: DaVita generates a meaningful share of dialysis and lab revenues, and most of its profits, from commercially insured patients, but this mix is under pressure. Rising unemployment could accelerate shifts from commercial plans to government coverage, and the share of non-government reimbursed treatments has already been declining.With a large portion of patients already covered by Medicare or Medicaid, further growth in Medicare Advantage enrolment could compress margins, as lower government reimbursement rates may strain profitability and potentially lead to dialysis center closures.Estimate TrendDaVita is witnessing a stable estimate revision trend for 2025. In the past 30 days, the Zacks Consensus Estimate for earnings per share has remained stable at $10.70.The Zacks Consensus Estimate for the company’s fourth-quarter 2025 revenues is pegged at $3.53 billion, indicating a 6.9% uptick from the year-ago quarter’s reported number. The consensus mark for earnings is pegged at $3.24 per share, implying a 44.6% year-over-year decline. Stocks to ConsiderSome better-ranked stocks in the broader medical space are IDEXX Laboratories IDXX, Boston Scientific BSX and STERIS STE. Each stock presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Estimates for IDEXX’s 2025 earnings per share (EPS) have remained constant at $12.93 in the past 30 days. Shares of the company have risen 12.6% in the past year compared with the industry’s 11.1% growth. IDXX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.1%. In the last reported quarter, it delivered an earnings surprise of 8.3%.  Boston Scientific shares have gained 2.9% in the past year. Estimates for the company’s 2025 EPS have remained constant at $3.04 in the past 30 days. BSX’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 7.4%. In the last reported quarter, it posted an earnings surprise of 5.6%.STERIS shares have risen 9.1% in the past year. Estimates for the company’s 2025 EPS have increased by 2 cents to $10.23 in the past 30 days. STE’s earnings topped estimates in three of the trailing four quarters and matched on one occasion, delivering an average surprise of 2.6%. In the last reported quarter, it posted an earnings surprise of 2.6%.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Boston Scientific Corporation (BSX): Free Stock Analysis Report DaVita Inc. (DVA): Free Stock Analysis Report IDEXX Laboratories, Inc. (IDXX): Free Stock Analysis Report STERIS plc (STE): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks