Shares of DaVita Inc. (NYSE: DVA) are trading lower today in sympathy Fresenius Medical Care AG & Co (NYSE: FMS), which provided a bearish 2022 outlook and withdrew its 2025 targets.
What Happened?
In a press release yesterday, Fresenius Medical Care said it now expects 2022 revenue to grow at the low end of the previously guided low to mid-single digit percentage range. The Company now expects net income to decline by a high teens percentage range.
"The unprecedented U.S. labor market challenges materially worsened in the second quarter. For Fresenius Medical Care, this resulted in meaningfully higher than assumed wage inflation, surcharges, retention payments and additional costs for contract labor to contain the increasing staff shortages,” the company said.
Why It Matters
DaVita shares are trading lower out of concerns other companies in the space could experience similar headwinds.
DaVita is the largest provider of dialysis services in the United States, boasting market share that eclipses 35% when measured by both patients and clinics.
Price Action: DaVita shares are down 3.75% at $83.66.
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