Analysts at RBC Capital provided their views on R1 RCM Inc. (NASDAQ:RCM), noting that with the company already having secured an impressive $13 billion of new NPR this year, what continues to be underappreciated is the multi-year EBITDA visibility the ramping of these new contracts provide the company.
According to the analysts, there is a significant amount of EBITDA it will add over the next 3 years just by optimizing the work it has already won. Notably, around 40% (or $23 billion) of the total $55 billion of NPR R1 now manages is still in a ‘margin ramp’ phase. Furthermore, Optimization and Cloudmed cost synergies should contribute an incremental $300 million of EBITDA.