Key Takeaways
- BrightSpring Health Services stock jumped 12% as adjusted EBITDA rose 42% and 2026 guidance went up.
- Gross profit per script rose 27% in what management calls the peak year for Medicare’s drug-price negotiations.
- Home health census jumped 58% with branches bought from UnitedHealth’s Amedisys and LHC Group.
- Option Care Health and CVS Health report next week, a test of whether BrightSpring’s pricing gains show up elsewhere.
BrightSpring Health Services (BTSG) stock jumped 12% today after a third-quarter beat. Revenue rose 26% to $4.21 billion, adjusted EBITDA jumped 42% to $228 million, and the company raised its full-year guidance for both.
Its home health growth runs through branches UnitedHealth Group (UNH) had to sell, and its pricing gains raise a question for Option Care Health (OPCH) and CVS Health (CVS), which both report next week.
The pharmacy is earning more on every script
Pharmacy revenue rose 26% to $3.73 billion, while prescriptions rose just 1.5%. Gross profit per script rose 27% to $28.86, so gross profit grew faster than revenue, up 32% to $519 million:
That matters because of Medicare’s drug-price negotiations. CFO Jennifer Phipps said in September that 2026 is the peak year for that hit, and that 2027’s should be about half as big. Earning 27% more per script in the worst year is a strong sign.
The UnitedHealth branches are paying off
Home health average daily census jumped 58% to 47,256, helped by 107 branches BrightSpring bought from Amedisys and LHC Group, which UnitedHealth had to sell to close its Amedisys deal.
For UnitedHealth, the branches were small change. Optum Health’s third-quarter revenue was $22.9 billion, down 10% as UnitedHealthcare shed members to rebuild margins. Its adjusted margin was 2.6%, against a 6% to 8% target for 2028, a gap UnitedHealth has to close.
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Next week tests the pharmacy story
Option Care’s second-quarter revenue rose just 1.9%, so BrightSpring’s pace looks like excellent execution by management. CVS’s Health Services revenue rose 11.5% in that quarter on drug mix and brand inflation. But CVS said regulatory price cuts on certain drugs, new generics and pressure on reimbursement largely offset its retail pharmacy’s gains. Do those cuts get bigger?
The raise looks built to last
The new revenue range is above what analysts expected for the year going in. Here’s BrightSpring’s forward P/E over the last three years:
My take: The raised guidance looks solid, with the drug-pricing hit peaking this year by management’s account.
Of course, the pharmacy depends on drug prices it doesn’t set. Watch gross profit per script in the fourth-quarter report early next year.
So what is BrightSpring stock actually worth?
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