Reports: Tuesday, August 4, 2026, after market close | 2026Q2 Earnings Call
This is not a quiet earnings print. DVA shares have gone from roughly $114 at the start of 2026 to around $234 heading into the print — a move of more than 100% — with the single biggest jump coming the day after Q1 results, when the stock ripped from $157 to nearly $194 in one session. Shares have kept grinding higher since (touching the $240s in late July) even as sell-side price targets have scrambled to catch up: UBS to $270, Truist to $250, Barclays to $218, all raised multiple times since May. Notably, the stock is currently trading above the sell-side average price target (~$209 vs. a share price in the $230s-$240s just before this report), which means expectations — and the bar for a "good enough" quarter — are elevated.
The rally has been driven almost entirely by a series of beat-and-raise quarters, resilient volumes despite lingering GLP-1 demand-destruction fears, a favorable regulatory turn in California, and aggressive capital returns. That combination sets up a classic high-expectations earnings event: fundamentals have been genuinely strong, but the stock now needs continued upside surprises to justify further appreciation.
Q1 2026 was a blowout relative to expectations: adjusted EPS of $2.87 (vs. ~$2.33 consensus) on revenue of $3.42 billion, with adjusted operating income of $482 million. Management raised full-year guidance:
| Metric | New 2026 Guidance | Prior Guidance |
|---|---|---|
| Adjusted operating income | $2.15B – $2.25B | $2.085B – $2.235B |
| Adjusted diluted EPS | $14.10 – $15.20 | $13.60 – $15.00 |
| Free cash flow | $1.0B – $1.25B (unchanged) | $1.0B – $1.25B |
Management also raised full-year U.S. dialysis volume growth guidance from flat to +25 to +50 basis points, citing better-than-forecast mortality and an incremental tailwind from patients transferring in as Fresenius closes clinics. Revenue-per-treatment guidance was held at 1%-2% for the year, and patient care cost trends improved on better labor productivity.
1. Volume trajectory / Fresenius transfers. Management said roughly half of the Fresenius-closure-related patient transfers had already shown up by the end of Q1, with the rest expected in Q2 — implying the company should capture "about two-thirds of a year's worth" of those transfer-related new starts in 2026. Q2 treatments-per-normalized-day growth (management flagged Q1 at +40 bps, guiding toward +50-75 bps for the full year) is the single most-watched operating metric. Q2 is also a clean comparison quarter — normalized treatment days are flat year-over-year (78.0 vs. 78.0) — so there's less noise from calendar effects than in Q1 or Q4.
2. Revenue per treatment, ACA/OBBBA dynamics. Q1 RPT grew ~4% year-over-year, though management attributed about $6 of the ~$17.50 increase to timing and reiterated the 1%-2% full-year guide, expecting commercial mix to soften over the year. A key swing factor is the ACA marketplace: DaVita had guided to a ~$40 million headwind in 2026 tied to the loss of enhanced premium tax credits/marketplace dynamics under the OBBBA, and as of Q1 that was trending "a little better" than the $40 million estimate — but also noted more patients selecting cheaper bronze plans, which raises patient out-of-pocket exposure and creates a modest offsetting RPT drag. Investors will want an update on how enrollment/mix is actually tracking now that more of the year has played out.
3. Cost trends and technology spend. Patient care cost per treatment was roughly flat sequentially in Q1 on better productivity; G&A per treatment, however, was up 13% year-over-year as DaVita invests heavily in IT/AI infrastructure (its EMR platform, an AI-driven scheduling tool called ScheduleHub, etc.). Management has framed this as "not optimizing the geography" of costs but managing the total cost structure to a 1.25%-2.25% growth target — worth confirming that logic is holding as the AI investment cycle continues.
4. Integrated Kidney Care (value-based care). IKC posted a $19 million adjusted operating loss in Q1 but continues to show clinical/economic progress — DaVita highlighted the highest aggregate savings of any CKCC (Comprehensive Kidney Care Contracting) participant, driven by a 4.5% improvement in gross savings rate since program inception. IKC covered ~62,600 risk-based patients and ~$5.4 billion of annualized medical spend as of Q1. The path to IKC profitability and how it phases through the year (management flagged a Q4-weighted IKC operating income pattern for 2026) is a longer-term thesis point.
5. Capital allocation, leverage, and the Berkshire dynamic. DaVita bought back 3.0 million shares in Q1 ($403M) plus another 2.0 million shares after quarter-end through early May ($302M), including shares repurchased from Berkshire Hathaway under its standing repurchase arrangement. Leverage sat at 3.34x — within the 3.0x-3.5x target range — after the credit facility was amended/expanded in late 2025 (and reportedly expanded further via a term loan facility in June 2026) to preserve flexibility for continued buybacks. Berkshire has separately been reported selling down its DVA stake into the rally, and multiple DaVita insiders (including the CFO) have sold meaningful stock in recent months — worth monitoring, though much of this looks programmatic given the size of the run.
Estimates have been climbing but show some dispersion: - Zacks consensus: revenue of ~$3.53 billion (+4.5% y/y) and EPS of ~$4.01 (+35.9% y/y). - Alphastreet/other trackers: average EPS estimate around $3.88 (range $3.62-$4.22) on revenue near $3.49 billion (range $3.44B-$3.54B). - Full-year 2026: Street consensus EPS sits around $15.07 (above the midpoint of DaVita's own $14.10-$15.20 guidance range), with FY2027 consensus near $18.37, implying the market is underwriting continued double-digit-plus earnings growth.
Notably, expected revenue growth of roughly 3.5%-4.5% year-over-year in Q2 represents a deceleration from the 6%+ growth logged in Q1 and year-ago Q2 — a function of tougher comparisons and normalizing RPT tailwinds — so the EPS beat, if any, is more likely to come from cost control, buybacks, and IKC/international performance than a revenue surprise.
DaVita goes into Q2 with real operating momentum — better mortality/volume trends, Fresenius-driven share gains, disciplined cost management, a friendlier regulatory backdrop in California, and aggressive buybacks compressing the share count — all of which drove one of the best-performing large-cap healthcare stock rallies of 2026. The bar, however, is now high: consensus expects EPS growth in the mid-30s% range and the stock trades above where most analysts have set their price targets. The most important things to watch on the call are (1) whether treatment volume/Fresenius transfer trends are tracking at or above the raised guidance, (2) any incremental clarity on the ACA/OBBBA enrollment and mix impact, and (3) confirmation that cost discipline (especially G&A/tech spend) and capital returns can keep pace with an increasingly demanding set of Street expectations.