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Pediatrix Medical Group

MD
45
Medical - Care Facilities · Healthcare
Price
$26.13
-0.21 (-0.80%)
Market Cap
$2.15B
Winston Score
45
Winston is serious
Mixed quality — meaningful strengths and weaknesses.

Share count falling — buybacks

1.3% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 86.4M (2021) → 85.3M (2025)

Pediatrix Medical Group is a company that provides doctor services inside hospitals, focused on caring for newborns, mothers, and children. Their main services include neonatal care (caring for sick or premature babies in hospital nurseries), maternal-fetal medicine, and pediatric specialty care. They are one of the largest physician practice management companies in the United States focused on women's and children's health.

Pediatrix makes money by billing patients and insurance companies, including government programs like Medicaid and Medicare, for the medical services their doctors provide. The company operates across hundreds of hospitals in the United States, generating roughly $2 billion in annual revenue. Their competitive position comes from their scale — hospitals often prefer to outsource specialty physician staffing to one large, reliable partner rather than manage it themselves. The key risk the business faces is reimbursement pressure, meaning government and private insurers could reduce how much they pay per patient visit, which would directly squeeze the company's margins.

Winston Score History

Score breakdown

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Quality

Gross Margin
23.7%
Thin — 23.7% gross margin
Operating Margin
9.8%
Modest — 9.8% operating margin
ROCE
3.2%
Weak — 3.2% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY
-2.3%
Shrinking sales (-2.3% YoY)
EPS YoY
N/A
Data not available
EPS Consistency
8/8 quarters
Every recent quarter grew earnings vs last year

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Cash Flow

Cash Conversion
149%
Turns 149% of profit into real cash
FCF Margin
12.3%
Converts sales into free cash efficiently (12.3%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

Debt / Equity
0.67
Moderate — manageable debt (0.67)
Interest Cover
7.85x
Adequate interest coverage (7.9x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)
12.7x
Attractive valuation — P/E 12.7

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

P/E vs Forward
+1.6
GROWING
Earnings expected to grow — slightly cheaper on forward P/E

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Dividends

Not applicable for this business.
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