A rumored bidding war over home-health technology player Signify Health sent SGFY stock to a year-high Monday, and pulled shares of Privia Health along for the ride.
On the stock market today, Signify shares roared 32.1% higher to 28. At one point, SGFY stock hit 29.88, rising as much as 41% in bullish volume. That was Signify's biggest single-day stock move since shares began trading in February 2021.
The surge followed a Bloomberg report that various suitors are looking to acquire Signify. UnitedHealth Group is the top contender with a bid at $30 per share, according to people familiar with the matter.
Amazon is trailing closely. Other bidders include CVS Health and Option Care Health.
SGFY Stock: A New Model In Medicine
Signify is reportedly holding a board meeting Monday to discuss the bids. Spokespersons for Signify, Amazon, CVS and UnitedHealth declined to comment to Investor's Business Daily. Representatives of Option didn't immediately return a request for comment.
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Signify helps health plans, government programs and employers shift to value-based plans. Experts link better health outcomes to early intervention. It's easier, for example, to treat earlier-stage cancer than late-stage. This model prioritizes preventive care.
Privia is in a similar market. It offers software that helps manage physicians' offices. Its model pushes doctors to offer value-based services.
The rumor Monday sent Privia stock flying 15.1% to 41.98. Shares of Privia and SGFY stock are highly rated, with Relative Strength Ratings of 97 out of a best-possible 99. This means both stocks rank in the top 3% in terms of 12-month performance, according to IBD Digital.
Regulatory Clearance Could Be Tricky
For Amazon, a Signify buyout would increase its presence in the health realm. The e-commerce giant just announced its plan to buy primary-care clinic player One Medical for $3.9 billion.
UnitedHealth also is working to buy Change Healthcare, though the $13 billion deal is getting heat from the U.S. Department of Justice. The Justice Department sued to block the merger in February over antitrust concerns. Now, a trial is underway.
So, any deal to buy SGFY stock could also capture regulators' interest.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
