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DaVita Inc. provides kidney dialysis services for patients suffering from chronic kidney failure or end stage renal disease (ESRD). The company operates kidney dialysis centers and provides related lab services in outpatient dialysis centers. It also provides outpatient, hospital inpatient, and home-based hemodialysis services.



DaVita provides lifesaving healthcare services to chronically ill patients in a low-cost, outpatient setting. DaVita accounts for over33% of all dialysis facilities and patient treatments and treats about 200,000 patients in the U.S. out of the 500,000 who currently require maintenance dialysis.

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DaVita earns about 66% of its revenue from government-based payers with the other third from commercial-pay patients which was why it was important the Californians rejected Proposition 8 some months ago, which would have limited revenue earned by dialysis clinics within the state.  The measure would have required refunds from dialysis clinics of up to $100,000 to insurance providers and patients who paid out of pocket

NOTE: DaVita operates half of all the chronic dialysis clinics in the state, and spent $66.6 million to defeat the measure.

Now I will be honest, I have never heard of DaVita Inc. until Monday.  I noticed unusual options activity on Monday when I noticed the Smart Money bought over 10,000 option of the Jan 18 2019, $67.5 strike price call options (that sold for an avg. price of $0.70 / contract) against 650 contracts in open interest.  Mind you, the price was in the upper 50s at this point.  Thus, the Smart Money thinks price will be above $67 in about 40 days…that’s an increase of 15% in the stock price, but would mean 200-300% in the option price. 

However, yesterday, I noticed more bullish unusual options activity.  This time it was the Jan 18 2019, $65 strike price call options.

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When you see that type of bullish activity on multiple days, something is definitely about to happen. 

Heading into the fourth quarter of 2018, a total of 42 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 24% from one quarter earlier. By comparison, 40 hedge funds held shares or bullish call options in DVA heading into this year.

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The largest stake  was held by Berkshire Hathaway, which reported holding $2762.5 million worth of stock at the end of September. 

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It was followed by Empyrean Capital Partners with a $171.5 million position. Other investors bullish on the company included Matrix Capital Management, Gates Capital Management, and PAR Capital Management.

<center>[Source](https://finance.yahoo.com/news/hedge-funds-think-davita-inc-140228547.html)</center>

On the weekly chart, nothing stands out to me, so the question is does the Smart Money know something we don't know....stay tune.

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This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.

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