FORT WORTH, Texas—Q Global Capital Management, L.P., a significant stakeholder in ModivCare Inc (NASDAQ:MODV), recently reported a series of transactions involving the company's common stock. According to the latest SEC filing, the firm sold shares amounting to a total of approximately $5.4 million. These sales occurred at prices ranging from $6.53 to $11.81 per share, with the stock currently trading near its 52-week low of $6.32. InvestingPro analysis indicates the stock is currently undervalued, with analysts setting price targets between $10 and $42.
The transactions were executed on January 10 and January 13, 2025, and resulted in a reduction of Q Global's holdings in ModivCare. Despite these sales, Q Global also acquired additional shares worth approximately $48,384 at an average price of $12.61 per share on January 10.
Q Global Capital Management, along with Q Global Advisors, LLC, Renegade Swish, LLC, and Geoffrey Raynor, maintains a significant ownership stake in ModivCare, as indicated by their filing status as ten percent owners. The transactions were carried out under the direct ownership of Q Global Capital Management.
In other recent news, ModivCare Inc. announced its third-quarter earnings, reporting revenue of $702 million and an adjusted EBITDA of $43 million. Despite a net loss of $27 million, the company revised its adjusted EBITDA guidance for 2024 to between $170 million and $180 million. Additionally, ModivCare projects a 10% increase in adjusted EBITDA for 2025, driven by membership growth and new contracts.
The company also disclosed significant changes to its board, with Christopher S. Shackelton and Rahul Samant stepping down. The vacancies were promptly filled by Leslie V. Norwalk as the new Interim Chair of the Board and the addition of two new independent directors, Craig Barbarosh and Neal Goldman.
Furthermore, Lake Street Capital Markets significantly reduced the price target for ModivCare shares to $10.00, a sharp decline from the previous $30.00 target, while reaffirming a Buy rating on the stock. This adjustment follows ModivCare's decision to withdraw its financial guidance for the years 2024 and 2025 due to changes in its business and the broader market environment.
Lastly, ModivCare secured $75 million in additional financing from some of its existing lenders, who also agreed to provide relief from financial covenants related to the company's debt ratios. This financial buffer is anticipated to maintain ModivCare's liquidity until at least mid-year 2025, allowing the company the flexibility to implement strategic actions, potentially including the sale of assets. These are the recent developments reflecting the company's strategic positioning and operational efficiency.
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