Breaking Down ModivCare Inc. (MODV) Financial Health: Key Insights for Investors

Are you keeping a close watch on ModivCare Inc.'s (MODV) financial performance? As of their latest report on March 6, 2025, the company's full year 2024 results show a service revenue of $2,787.6 million, a 1.3% increase compared to 2023. However, the company reported a net loss of $201.3 million, or negative $14.14 per diluted common share. With a recent class action securities lawsuit alleging false statements about its Non-Emergency Medical Transportation (NEMT) segment, and key metrics like a negative P/E ratio of -0.24 and a debt-to-equity ratio of -74.27, understanding ModivCare's financial health is crucial for investors. Let's dive into a detailed breakdown of the key insights.

ModivCare Inc. (MODV) Revenue Analysis

ModivCare Inc. (MODV) operates primarily through two main segments: Non-Emergency Medical Transportation (NEMT) and Home Solutions. Understanding the revenue streams of each segment provides critical insights into the company's financial health and growth trajectory.

In the fiscal year 2024, ModivCare's revenue streams can be analyzed as follows:

• Non-Emergency Medical Transportation (NEMT): This segment constitutes a significant portion of ModivCare's revenue. NEMT services involve coordinating and providing transportation for individuals who need assistance getting to and from medical appointments.
• Home Solutions: This segment focuses on providing home-based services, including personal care, meal delivery, and other support services that enable individuals to remain in their homes and avoid institutional care.

To illustrate the revenue contributions and growth, consider the following hypothetical (but structurally aligned with potential real data) breakdown for the fiscal year 2024:

Analyzing year-over-year revenue growth rates offers insights into ModivCare's performance. For example, if ModivCare's total revenue in 2023 was $2,500 million and it grew to $2,667 million in 2024, the year-over-year growth rate would be approximately 6.68%. This growth rate reflects the company's ability to expand its services and market reach within its key segments.

Significant changes in revenue streams can stem from various factors, including:

• Acquisitions and divestitures
• New contracts or loss of existing contracts
• Changes in reimbursement rates
• Expansion into new geographic markets
• Changes in service offerings

Investors interested in a deeper dive into ModivCare Inc. (MODV) can explore additional resources, such as Exploring ModivCare Inc. (MODV) Investor Profile: Who’s Buying and Why?

ModivCare Inc. (MODV) Profitability Metrics

Assessing the financial health and profitability of ModivCare Inc. (MODV) requires a detailed look into its key financial metrics. These metrics provide insights into the company's efficiency in generating profits from its revenue and managing its operational costs.

Here's an overview of the essential profitability metrics for ModivCare Inc. (MODV):

• Gross Profit Margin: This ratio indicates the percentage of revenue remaining after subtracting the cost of goods sold (COGS). It reflects the company's efficiency in managing production costs.
• Operating Profit Margin: This margin reveals the percentage of revenue left after deducting operating expenses (e.g., administrative costs, salaries). It showcases the company's profitability from its core business operations before interest and taxes.
• Net Profit Margin: The net profit margin represents the percentage of revenue that translates into net income after all expenses, including interest and taxes, are considered. It is a comprehensive measure of overall profitability.

To effectively evaluate ModivCare Inc.'s (MODV) profitability, it is crucial to compare these ratios against industry averages and analyze their trends over time. Doing so provides a more contextual understanding of the company's financial performance. Analyzing operational efficiency, such as cost management and gross margin trends, can further refine the assessment.

For example, a steady increase in gross profit margin may indicate improved cost management strategies or more favorable pricing. Conversely, a declining net profit margin could signal rising operating expenses or increased tax liabilities.

Here's a hypothetical table illustrating how ModivCare Inc.'s (MODV) profitability metrics might look over a three-year period:

In this example, there is a year-over-year improvement in all margins, suggesting enhanced profitability and operational efficiency. Such trends are vital for investors to identify whether ModivCare Inc. (MODV) is on a positive trajectory.

Understanding the mission, vision, and core values can give you a clearer picture of the qualitative factors driving ModivCare Inc.'s (MODV) performance. You can learn more here: Mission Statement, Vision, & Core Values of ModivCare Inc. (MODV).

ModivCare Inc. (MODV) Debt vs. Equity Structure

Understanding how ModivCare Inc. (MODV) finances its operations and growth is crucial for investors. This involves analyzing its debt levels, debt-to-equity ratio, and recent financing activities.

As of December 31, 2024, ModivCare Inc. (MODV) reported the following debt figures:

• Long-term debt: $1.27 billion
• Short-term debt: $42.12 million

The company's financial statements provide a detailed breakdown of its debt obligations, including maturities and interest rates. Monitoring these figures helps investors assess ModivCare Inc. (MODV)'s ability to manage its debt.

The debt-to-equity ratio is a key metric for evaluating a company's financial leverage. As of the end of 2024, ModivCare Inc. (MODV)'s debt-to-equity ratio can be calculated using the total liabilities and shareholder equity figures from its balance sheet. While the exact ratio requires up-to-date calculations, it's essential to compare it against industry standards to gauge whether ModivCare Inc. (MODV)'s leverage is within a reasonable range.

Recent activities, such as debt issuances, credit ratings, or refinancing, can significantly impact ModivCare Inc. (MODV)'s financial health. For instance, a debt issuance increases the company's liabilities but can provide capital for expansion or acquisitions. Credit ratings from agencies like Standard & Poor's and Moody's offer insights into ModivCare Inc. (MODV)'s creditworthiness. Refinancing activities might lower interest rates or extend debt maturities, improving cash flow.

Balancing debt and equity is vital for sustainable growth. ModivCare Inc. (MODV) needs to strategically manage its debt to finance growth without taking on excessive risk. Equity funding, such as through stock offerings, can reduce reliance on debt but may dilute existing shareholders' ownership. The company's approach to this balance reflects its financial strategy and risk tolerance.

For more insights into ModivCare Inc. (MODV) and its investors, check out: Exploring ModivCare Inc. (MODV) Investor Profile: Who’s Buying and Why?

ModivCare Inc. (MODV) Liquidity and Solvency

Assessing ModivCare Inc.'s financial health involves a close look at its liquidity and solvency. These metrics provide insights into the company's ability to meet its short-term obligations and long-term financial stability.

Here's an overview of key financial indicators:

Assessing ModivCare Inc.'s Liquidity

Liquidity ratios measure a company's ability to cover its short-term liabilities with its short-term assets. Key ratios include the current ratio and the quick ratio.

• Current Ratio: The current ratio is calculated by dividing current assets by current liabilities. A current ratio of 1.0 or higher generally indicates that a company has enough liquid assets to cover its short-term liabilities.
• Quick Ratio: The quick ratio, also known as the acid-test ratio, excludes inventory from current assets to provide a more conservative measure of liquidity. It is calculated as (Current Assets - Inventory) / Current Liabilities. A quick ratio of 1.0 or higher suggests strong short-term liquidity.

Analysis of working capital trends is also crucial. Working capital is the difference between a company's current assets and current liabilities. Monitoring changes in working capital can reveal whether a company's short-term financial health is improving or deteriorating.

Here is a table summarizing ModivCare's liquidity position based on available data:

Cash Flow Statements Overview

Cash flow statements provide a detailed look at how a company generates and uses cash. These statements are divided into three main categories:

• Operating Activities: Cash flow from operating activities reflects the cash generated from the company's core business operations. A positive cash flow from operations indicates that the company is generating enough cash to sustain and grow its business.
• Investing Activities: Cash flow from investing activities includes cash used for investments in assets, such as property, plant, and equipment (PP&E). Negative cash flow in this category may indicate that the company is investing in its future growth.
• Financing Activities: Cash flow from financing activities involves cash flows related to debt, equity, and dividends. This section shows how the company is funding its operations and returning value to shareholders.

Analyzing these cash flow trends can reveal whether ModivCare Inc. is effectively managing its cash and investing in its future.

Potential liquidity concerns may arise if the company has:

• Declining current and quick ratios
• Negative trends in working capital
• Negative cash flow from operations

Conversely, strengths include:

• Increasing current and quick ratios
• Positive trends in working capital
• Positive cash flow from operations

Understanding these factors is essential for investors to gauge ModivCare Inc.'s financial stability and growth potential. For additional insights into ModivCare Inc. and its investors, check out: Exploring ModivCare Inc. (MODV) Investor Profile: Who’s Buying and Why?

ModivCare Inc. (MODV) Valuation Analysis

Assessing whether ModivCare Inc. (MODV) is overvalued or undervalued requires a look at several key financial metrics and market indicators. Here's a breakdown to help investors make informed decisions:

• Breaking Down ModivCare Inc. (MODV) Financial Health: Key Insights for Investors

Valuation Ratios:

• Price-to-Earnings (P/E) Ratio: As of April 2025, ModivCare's P/E ratio is reported at 6.35 and 1.90 (Normalized P/E). However, another source indicates a negative P/E ratio of -0.0781. The negative P/E ratio suggests the company has negative earnings.
• Price-to-Book (P/B) Ratio: The Price to Book ratio is reported as -0.50. A negative P/B ratio can occur if a company has negative book value, which could be due to accumulated losses or other factors affecting its equity.
• Enterprise Value-to-EBITDA (EV/EBITDA): The EV/EBITDA ratio is 5.80. This ratio compares the total value of the company (enterprise value) to its earnings before interest, taxes, depreciation, and amortization (EBITDA).
• Price-to-Sales (P/S) Ratio: ModivCare's P/S ratio is very low at 0.01. When compared to its peers, ModivCare's P/S ratio appears undervalued.

Stock Price Trends:

• Recent Performance: ModivCare Inc. (MODV) stock has shown significant volatility. As of April 17, 2025, the stock price was around $0.99.
• 52-Week Range: The 52-week range is $0.96 to $32.82, highlighting substantial price fluctuation over the past year.
• 1-Year Change: The stock has decreased by -95.36% over the past year.
• 3-Month Change: The stock has decreased by -84.81% over the past three months.

Dividend Information:

• Dividend Yield: ModivCare's dividend yield is 0.00%.
• Payout Ratio: The dividend payout ratio is 0.00%.

Analyst Consensus:

• Rating: The analyst consensus is a 'Moderate Buy'.
• Price Target: The average 12-month price target from analysts is $4.92, indicating a potential increase of 339.29% from the current price. However, forecasts vary widely, with some analysts projecting a price as low as $3.50 and as high as $6.00.

Additional Factors:

• Market Cap: ModivCare has a market capitalization of approximately $14.14 million to $18.50 million.
• Debt: The company faces a significant debt burden of $1.3 billion.
• Revenue: ModivCare's revenue for 2024 was $2.79 billion, a 1.32% increase from the previous year.
• Earnings Per Share (EPS): The Earnings per share is $-14.14.

Here's a summary of key valuation metrics for ModivCare Inc. (MODV):

Given these data points, ModivCare Inc. (MODV) appears to be undervalued based on its price-to-sales ratio and potential analyst price targets. However, investors should be cautious due to the company's negative earnings, substantial debt, and recent stock performance. A debt restructuring deal and revenue decline in core business segments contribute to a mixed outlook.

ModivCare Inc. (MODV) Risk Factors

ModivCare Inc. (MODV) faces a variety of internal and external risks that could significantly impact its financial health. These risks span across industry competition, regulatory changes, and overall market conditions. Understanding these potential challenges is crucial for investors.

Industry Competition: The healthcare services industry is intensely competitive. ModivCare operates in a market where numerous providers vie for contracts with state and federal agencies, managed care organizations, and other payers. Increased competition could lead to pricing pressures, reduced market share, and decreased profitability.

Regulatory Changes: The healthcare industry is heavily regulated, and changes in laws and regulations can have a substantial impact on ModivCare's operations and financial results. This includes changes to:

• Medicaid and Medicare reimbursement rates
• Healthcare reform legislation
• Transportation regulations
• Data privacy and security laws (e.g., HIPAA)

Compliance with these regulations requires ongoing investment and resources. Failure to comply can result in significant penalties, loss of licenses, and damage to the company's reputation.

Market Conditions: Economic downturns, changes in demographics, and shifts in healthcare utilization patterns can all affect ModivCare's business. For example, a recession could lead to reduced state budgets for healthcare, which in turn could reduce funding for the programs ModivCare supports. Additionally, changes in demographics, such as an aging population, could increase demand for certain services while decreasing demand for others.

Operational Risks: ModivCare faces several operational risks, including:

• Contract Management: A significant portion of ModivCare's revenue comes from contracts with government entities and managed care organizations. The loss of a major contract or unfavorable renegotiation terms could have a material adverse effect on the company's financial performance.
• Service Delivery: Ensuring the timely and reliable delivery of services is critical. Any disruptions to transportation networks, technology systems, or other key infrastructure could negatively impact service levels and customer satisfaction.
• Data Security: As a healthcare provider, ModivCare handles sensitive patient data. A data breach or cyberattack could result in significant financial losses, legal liabilities, and reputational damage.

Financial Risks: Several financial risks can impact ModivCare's stability:

• Liquidity Risk: Maintaining sufficient cash flow to meet operational and financial obligations is essential. Factors such as delayed payments from payers, increased operating expenses, or unexpected capital expenditures could strain liquidity.
• Credit Risk: ModivCare's ability to access credit markets on favorable terms is important for funding growth and managing debt. Changes in credit ratings or market conditions could increase borrowing costs and limit access to capital.
• Acquisition and Integration Risks: ModivCare has grown through acquisitions, and integrating acquired businesses can be complex and challenging. Failure to successfully integrate acquisitions could result in lost synergies, higher-than-expected costs, and disruption to existing operations.

Strategic Risks: Strategic risks include:

• Innovation: The healthcare industry is constantly evolving, and ModivCare must adapt to new technologies and service delivery models to remain competitive. Failure to innovate could lead to obsolescence and loss of market share.
• Geographic Concentration: ModivCare may have significant operations in certain geographic areas, making it vulnerable to regional economic downturns or regulatory changes.
• Reputation: Maintaining a positive reputation is crucial for attracting and retaining customers, employees, and investors. Negative publicity, whether related to service quality, regulatory compliance, or other issues, could damage the company's brand and financial performance.

While specific mitigation strategies are not detailed here, ModivCare likely employs various risk management techniques, such as:

• Diversifying its customer base
• Investing in compliance programs
• Implementing robust cybersecurity measures
• Maintaining strong relationships with payers and regulators

For more detailed information, refer to ModivCare's latest annual report on Form 10-K and other filings with the Securities and Exchange Commission (SEC). These documents provide a comprehensive overview of the company's risk factors and management's plans to mitigate these risks.

ModivCare Inc. (MODV) Growth Opportunities

ModivCare Inc. (MODV) is strategically positioned for future growth, driven by several key factors. These include innovative service offerings, market expansion strategies, strategic acquisitions, and key partnerships.

Here's an analysis of ModivCare's growth drivers, future projections, and competitive advantages:

• Key Growth Drivers: ModivCare's growth is propelled by its focus on addressing the social determinants of health (SDOH). This includes offering non-emergency medical transportation (NEMT), remote patient monitoring, and personal care services. These services are crucial for individuals with chronic conditions and limited access to healthcare.
• Product Innovations: Continuous innovation in service delivery and technology enhances ModivCare's efficiency and effectiveness. This includes leveraging data analytics to improve transportation logistics and patient outcomes.
• Market Expansion: ModivCare strategically expands its geographic footprint and service offerings to capture new market opportunities.
• Acquisitions: Strategic acquisitions enable ModivCare to integrate complementary services and technologies, broadening its market reach and service capabilities.

Analysts' consensus revenue growth forecast for ModivCare Inc. (MODV) indicates a promising trajectory. The company's strategic initiatives and market positioning are expected to drive substantial revenue increases in the coming years. While specific figures may vary among different analysts and reports, the general outlook points towards consistent growth. Investors can stay informed about these projections by regularly consulting financial news outlets and analyst reports for the most up-to-date estimates.

Earnings estimates also show a positive trend, reflecting ModivCare's ability to improve profitability through operational efficiencies and economies of scale. These estimates are subject to change based on market conditions and company performance, making continuous monitoring essential for investors.

Strategic initiatives and partnerships play a crucial role in ModivCare's growth strategy. For instance, collaborations with healthcare providers and payers enhance service integration and market penetration. These partnerships often lead to new business opportunities and expanded service offerings, contributing to overall growth.

A significant competitive advantage for ModivCare lies in its established network and expertise in managing complex healthcare logistics. This infrastructure allows the company to efficiently deliver services across diverse geographic areas, creating a barrier to entry for new competitors. Additionally, ModivCare's data analytics capabilities provide valuable insights for optimizing service delivery and improving patient outcomes, further strengthening its competitive position.

The following table summarizes ModivCare's key growth prospects:

For more insights into ModivCare's investor profile, consider reading: Exploring ModivCare Inc. (MODV) Investor Profile: Who’s Buying and Why?