Assessing AdaptHealth (AHCO) Valuation After Recent Share Price Pullback and New Long-Term Contract

AdaptHealth (AHCO) has quietly slipped about 9% over the past month, even as revenue and net income keep growing. That kind of disconnect tends to catch value focused investors’ attention. See our latest analysis for AdaptHealth. Zooming out from the recent pullback, AdaptHealth’s 1 month share price return of minus 8.9 percent sits against a relatively modest year to date share price decline and a far more painful 3 year total shareholder return of roughly minus 57 percent. This suggests sentiment is still repairing even as fundamentals improve. If AdaptHealth’s mix of pressure and potential has you rethinking your healthcare exposure, this could be a smart moment to scout other opportunities across healthcare stocks. With revenue and profits rising, a moderate value score, and shares trading at a steep discount to analyst targets and estimated intrinsic value, is AdaptHealth a contrarian buy today, or is future growth already fully priced in? Most Popular Narrative: 28.2% Undervalued With AdaptHealth last closing at $9.42 against a narrative fair value a little above $13, the story leans toward meaningful upside if projections land. The newly signed five year, $1+ billion exclusive capitated contract with a major national health system substantially increases AdaptHealth's long term base of recurring revenue. This enables predictable growth as US healthcare continues to shift toward home based delivery and value focused payer arrangements. This will drive significant topline revenue expansion beginning in 2026 and help stabilize net earnings through a higher mix of recurring/non cyclical revenue. Read the complete narrative. Want to see how a single contract, rising margins, and faster earnings growth combine into that upside case? The playbook and projections sit inside this narrative. Result: Fair Value of $13.13 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this upside depends on navigating CMS reimbursement changes and executing the capital intensive capitated contract without costly delays or margin-compressing overruns. Find out about the key risks to this AdaptHealth narrative. Build Your Own AdaptHealth Narrative If you see the story differently or want to put your own assumptions to the test, you can spin up a custom view in just a few minutes: Do it your way. A great starting point for your AdaptHealth research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision. Looking for more investment ideas? If you are serious about sharpening your portfolio, do not stop at AdaptHealth, use the Simply Wall Street Screener to uncover fresh, data backed opportunities today. Target income focused stability with these 15 dividend stocks with yields > 3% that may strengthen your cash flow and reduce the pressure to time market swings. Capitalize on market mispricing by scanning these 906 undervalued stocks based on cash flows that could offer attractive upside before sentiment fully catches up. Position yourself at the frontier of innovation through these 81 cryptocurrency and blockchain stocks, where emerging business models could reshape how value moves across global markets. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.