BTIG Starts The Oncology Insititute Inc. (TOI) at Buy

BTIG analyst David Larsen initiates coverage on The Oncology Insititute Inc. (NASDAQ: TOI) with a Buy rating and a price target of $7.00.

The analyst comments "We are initiating coverage of The Oncology Institute (TOI) with a Buy rating and a PT of $7. The Oncology Institute specializes in the treatment and management of cancer patients through a blend of both fee-for-service, capitated, and value-based-care contracts. Similar to Privia (PRVA, Buy, $35 PT), TOI will enter into risk arrangements when it makes sense to do so in certain markets, with certain contracts and health plans. We estimate that ~18% of revenue in 2024 was "capitated," ~46% of revenue was in value-based-care, the capitated margins for TOI tend to be high, and we like how TOI makes money based on increasing volumes, higher medical trend, and expensive oncology medications, in fee-for-service deals, while also benefiting from at-risk contracts in certain markets. Managing care for oncology patients tends to be difficult, specialized, and complex, which means that TOI has a unique business model. TOI was formed in 2007, manages care for ~1.9M patients, and provided care for ~72,000 patients across 16 markets in 5 states, through its ~86 affiliated clinics in 2024. With the aging of America and rising complex care cost trends amongst some health plans, especially in Medicare Advantage, we expect fee-for-service revenue within TOI to rise as we progress into 2025. Likewise, demand for capitated and managed care, sub-contracted risk will likely increase as well."

For an analyst ratings summary and ratings history on The Oncology Insititute Inc. click here. For more ratings news on The Oncology Insititute Inc. click here.

Shares of The Oncology Insititute Inc. closed at $2.37 yesterday.

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