Is DaVita Inc. (DVA) overvalued or undervalued?
Updated Nov 10, 2026 · hand-researched model · educational, not advice
At a recent price of $185.54, DaVita Inc. (DVA) trades 49% below TickerWorth's blended fair value of $367.07 per share — a discounted-cash-flow model cross-checked against peer multiples and asset value — meaning the market currently prices DVA undervalued vs our estimate of what the business is intrinsically worth. Our fair value sits above the market, an implied +97.8% move to close the gap if the business performs in line with our assumptions. This is an educational model, not a price target or a recommendation — the value moves with the inputs, which you can test yourself using the WACC slider below.
One of the lenses behind that blended figure is a discounted-cash-flow model, which on its own values DVA at about $287.52 per share. The rest of this page walks through that DCF — its assumptions, reverse-DCF and discount-rate sensitivity — because it is the auditable anchor of the blend.
The valuation discounts DaVita Inc.'s projected free cash flows at a weighted-average cost of capital (WACC) of 7.8%, with a long-run terminal growth rate of 2.5%. About 78% of the enterprise value comes from the terminal value — the portion beyond the explicit forecast window — which is typical for a stable, cash-generative business and a reminder that small changes in the discount rate or terminal growth assumption swing the intrinsic value meaningfully.
Running the DCF in reverse — solving for the growth the current price already assumes — the market is implying roughly -1.9% annual revenue growth for DVA. Our base case instead compounds to about 3.5% a year over the same forecast, so the market is pricing in slower growth than our base case. The reverse-DCF is a quick sanity check: it reframes 'is this stock cheap?' as 'do I believe the growth the price requires?' rather than arguing over a single point estimate of fair value.
Sensitivity matters more than any single number. Across a reasonable band of discount-rate assumptions, DVA's modeled DCF value ranges from about $139.76 to $701.26 per share. If that range still sits below today's price, the market is optimistic relative to the model across the whole band; if it brackets the price, the stock is roughly fairly valued on our assumptions. Use the interactive slider to see exactly where your own cost-of-capital view lands.
How to read this page: the DCF fair value is what DaVita Inc. would be worth if its cash flows grow as modeled and are discounted at the stated WACC. The assumptions table shows every input and its source; the reverse-DCF shows what the market believes; the sensitivity band shows how fragile the answer is. None of this is investment advice — it is a transparent, auditable framework for forming your own view of DVA's intrinsic value. Figures update as new filings and prices come in.
The assumptions behind DVA's DCF
| Input | Value | Source |
|---|---|---|
| Base-year revenue | $13,643,100,000 | DaVita FY2025 10-K (accession 0000927066-26-000012, filed 2026-02-11); same figure in the 4Q 2025 earnings release, 8-K Ex-99.1 (accession 0000927066-26-000004, filed 2026-02-02): Total revenues $13,643,069K for FY2025: dialysis patient service revenues $13,007.2M + other revenues $635.9M. +6.5% on FY2024's $12,815.6M. UNCHANGED as the base — the DCF grows this figure by forecast.revenue_growth, so 2026 belongs in the forecast. REFRESH CROSS-CHECK: nine months of 2026 revenue was $10,547,758K, +5.24% on 9M 2025's $10,023,282K (Q3 alone $3,578,126K, +4.6%); TTM through 2026-09-30 is $14,167,545K. Mix: U.S. dialysis is ~85% of revenue ($9,004M of $10,548M in 9M 2026); integrated kidney care (IKC), other U.S. ancillary and 14 international markets are the rest. |
| Base EBIT margin | 15.0% | DaVita 4Q 2025 earnings release, 8-K Ex-99.1 (accession 0000927066-26-000004, filed 2026-02-02): GAAP operating income $2,043.6M / revenue $13,643.1M = 14.98%. Management's ADJUSTED operating income was $2,094M (15.35%), adding back $25M of cybersecurity-incident costs (the April 2025 ransomware attack) and a $25M international legal accrual. The GAAP figure is used as the base, so the base is very slightly conservative; it does not drive value, because the forecast starts from Year 1. TWO THINGS TO KNOW ABOUT WHAT THIS LINE CONTAINS: (1) it includes 100% of the operating profit of the physician joint ventures DaVita consolidates — the partners' share comes out below the line as 'net income attributable to noncontrolling interests', which is why the bridge deducts the noncontrolling interests (see market.net_debt); (2) it includes 'equity investment income, net', so the equity-method stakes are valued here and NOT added again in the bridge. REFRESH CROSS-CHECK: 9M 2026 GAAP operating income $1,560,148K / $10,547,758K = 14.79% — but that includes a $62M non-cash goodwill and other asset impairment on the China business taken in Q3; adjusted 9M operating income was $1,622M (15.38%), and H1 2026 printed 15.22% with no adjustments. |
| Forecast revenue growth | 4% → 3% → 4% → 4% → 3% | Assumption — TickerWorth's 5-year explicit forecast |
| Risk-free rate | 5.2% | US 10Y Treasury constant maturity (FRED DGS10): 5.24% on 2026-10-01, the latest published observation. Shared by every model in this tracker. |
| Beta | 0.96 | Assumption — Bottom-up beta: Damodaran 'Hospitals/Healthcare Facilities' unlevered beta (January 2026 data) relevered at DaVita's market leverage; published beta from yfinance: NOT RE-MEASURED on this quarterly refresh (quarterly-refresh convention, as in MA/HOOD/COIN/APP): the 0.96 bottom-up beta stands — Damodaran 'Hospitals/Healthcare Facilities' unlevered beta 0.56 (January 2026 data) relevered at DaVita's market leverage, against a published beta of 0.83 (Yahoo/yfinance 5Y-monthly, read 2026-10-03). NORMALIZED UP from the published figure — CONSERVATIVE: it raises the discount rate and LOWERS the value. Reason: DaVita runs with ~$10.8B of debt principal against an ~$12.2B equity value, and a cost of equity of 9.4% (what 0.83 gives) would sit barely 2.4 points above the ~7.0% its own BB-area bonds now cost — too thin a premium for the equity underneath that much debt. For the record, relevering the same 0.56 at THIS quarter's leverage (debt/equity 0.89 at the model price, 26% tax) prints ~0.93, worth ~7.57/share; re-derivation is left to the FY2026 annual refresh rather than done piecemeal. Each 0.1 of beta is worth roughly 25/share here; the published 0.83 would give ~322.09. |
| Terminal growth | 2.5% | Assumption — house default: House default 2.5% (roughly long-run nominal GDP), kept for comparability with every other company in this tracker. It is roughly what DaVita has actually done — revenue grew ~3% a year FY2019-FY2025 — but it is NOT conservative for this business: U.S. treatment volume has been close to flat for years (normalized non-acquired growth 0.1-0.4% through 2026), Medicare updates are running below cost inflation, and GLP-1 / SGLT2 drugs could slow the progression of kidney disease into dialysis. A 2.0% terminal rate takes the value from ~287.52 to ~252.44. Must remain < WACC of 7.76%. |
| Diluted shares | 66M | DaVita Q3 2026 10-Q (accession 0000927066-26-000134, filed 2026-10-29), quarter ended 2026-09-30: Q3 2026 weighted-average diluted shares 65,504K. The count is falling FAST: FY2024 87.3M, FY2025 75.9M, Q2 2026 66.1M, Q3 2026 65.5M — DaVita repurchased $450,862K of stock in 9M 2026 (0.6M shares for $111M in Q3 alone, at an average $186.21), and keeps buying from Berkshire Hathaway under the 2024-04-30 agreement that holds Berkshire's stake near 45%. Because of that, the weighted Q3 figure is already ~2.6M ABOVE the 62.9M shares outstanding at 2026-10-27 (10-Q cover; 63.4M at 2026-09-30, then a further 0.5M shares repurchased through 2026-10-27 for $87M); adding ~2M of dilution to the cover count gives ~65M today, which would lift the value to ~289.73. The 10-Q weighted diluted count is used anyway, per house method — mildly conservative, and it will step down again at Q4. |
| Market price | $185.54 | Delayed quote · as of 2026-11-10 05:49 UTC |
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