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Home Dialysis to Benefit These Undervalued Providers

Jake Strole, CFA (jake.strole@morningstar.com)

Specifically, the U.S. Department of Health and Human Services has proposed potential changes to reimbursement policy that are likely to encourage home treatment for kidney failure. While the stocks of both companies look cheap following recent underperformance, we think DaVita's nearly 30% discount to our fair value estimate presents a compelling investment opportunity. The two primary modalities amenable to at-home treatment are hemodialysis and peritoneal dialysis.