Nephron Adds to Physician Enablement Coverage with CareMax Initiation

Nephron Research has continued to focus its attention on the physician enablement market where companies are developing business models that seek to benefit from the creation of value through more effective care. Most recently, the Nephron team initiated on CareMax (CMAX) this week with a long-form (47 pgs) report to clients, where the team laid out its full thesis that included both positives and negatives including a few highlights:

A subset of the positives:

  • CareMax produces superior health outcomes for its patient population, and the longer the member stays, the more value that is created.
  • CareMax’s partnerships with Anthem and the Related Companies provide a strong pathway for de novo growth through at least 2024.
  • There is significant opportunity for revenue and earnings growth from simply optimizing the existing center capacity.

And some of the negatives:

  • Acquisitions have been the primary contributor to CareMax’s growth (and origin), which contrasts with the more recent pivot to de novo growth expected over the next three years.
  • CareMax’s membership and performance is dependent on a small group of payors – especially Anthem.
  • Entering the public markets through a merger with a SPAC creates a relative dearth of information for potential investors, making the investment process more challenging and ultimately having a potential impact on valuations.

For the investment thesis and more information on Nephron Research’s coverage of CareMax and the broader Physician Enablement sector, email: