What are the potential risks or upside scenarios for Owens & Minor's stock price in the next 3‑6 months based on this news release?

Potential Upside

• Divestiture of the Products & Healthcare Services segment – The company is “in the final stages” of selling a non‑core business. If the transaction closes at a premium to the segment’s book value, it could generate a one‑time cash inflow that will be used to fund share‑repurchases, reduce debt, or invest in higher‑margin Patient Direct operations. The market typically rewards clear‑cut “portfolio‑optimization” moves with a re‑rating of the remaining earnings power, so the stock could rally 5‑8 % if the proceeds are material and the guidance for the core business is raised.
  
• Focus on the Patient Direct segment – By stripping out the lower‑growth, lower‑margin product line, OMI’s earnings‑before‑interest‑tax‑depreciation‑amortisation (EBITDA) margin on the remaining business is expected to improve. Analysts may upgrade the FY‑2025 earnings per share (EPS) outlook, tightening the forward‑looking P/E multiple. A breakout above the 200‑day moving average (currently around $30) with volume above the 30‑day average would signal the upside is materializing.

Potential Risks

• Execution risk on the sale – If the divestiture stalls, the anticipated cash proceeds and the associated balance‑sheet de‑leveraging could be delayed, keeping the “continuing operations” earnings lower than expected. A missed or reduced cash‑flow target would likely trigger a sell‑off, pushing the stock back toward its 3‑month low (~$27).
  
• Revenue drag from the remaining segment – The press release only presents “continuing operations” results; if the Patient Direct segment underperforms (e.g., slower hospital‑contract wins, supply‑chain constraints, or margin compression), the revised guidance could fall short of consensus, prompting a downward revision of the FY‑2025 revenue growth outlook. In a risk‑off environment, the stock could see a 4‑6 % decline, especially if technical support at the 50‑day moving average (~$28.5) is broken.
  
• Valuation compression – The broader healthcare distribution sector is currently trading at a sub‑5× EV/EBITDA multiple. Any macro‑economic headwinds (higher interest rates, reduced hospital spending) could compress multiples further, limiting upside even if the divestiture proceeds as planned.

Trading Implications (3‑6 month horizon)

- Bullish case: Accumulate on pull‑backs near $28–$29 with a target of $34–$36 if the divestiture closes cleanly and the company upgrades FY‑2025 guidance.

- Bearish case: Reduce exposure if the sale stalls or if the 50‑day moving average is broken on high volume; consider a stop‑loss around $27.5.

Overall, the stock’s trajectory will hinge on the certainty and size of the cash proceeds from the Products & Healthcare Services sale and the ability of the streamlined Patient Direct business to meet or exceed earnings expectations. Monitoring the company’s next earnings call, any disclosed transaction terms, and price action around key moving‑average levels will be critical for positioning.