Fresenius Medical Care's share price is down in Jan 2026: Time to revisit the fundamentals
- Ben Tan
- Jan 23
- 4 min read
Fresenius Medical Care AG’s share price has fallen recently. Whenever that happens, I think it’s worth slowing down and revisiting the fundamentals instead of reacting to headlines or short-term price movements.
Before we go further, a quick disclaimer: I am a shareholder of Fresenius Medical Care AG, so this is not investment advice. This is how I think through the business as a long-term investor.
The key question isn’t whether the stock price is down.
The real question is: Has the business deteriorated, or is the market reassessing expectations while fundamentals quietly improve?
Based on the company’s recent updates, the answer appears to be more nuanced than the share price suggests.
A business showing signs of an earnings inflexion
In Q3 2025, Fresenius Medical Care AG delivered results that marked a clear operational turning point.
Organic revenue grew by roughly 10% year-on-year (around 8% at constant currency), with contributions across all segments. More importantly, U.S. dialysis treatment volumes returned to slight growth (+0.1%) on a same-centre basis after a period of decline. That may sound small, but in a mature healthcare business, stabilisation often comes before acceleration.
On the profitability side, adjusted operating income grew 28% at constant currency, lifting the operating margin to 11.7%. Net income rose 29% year-on-year, signalling that the operational restructuring is starting to flow through to the bottom line.
Crucially, leverage improved. Net debt declined, and net leverage fell to 2.6× EBITDA, even as the company continued to invest and return capital to shareholders. This combination—rising earnings with falling leverage—is exactly what you want to see in a turnaround.
Management reaffirmed full-year 2025 guidance, expecting:
Revenue growth in the positive to low single-digit range
Operating income growth in the high-teens to high-twenties per cent range versus 2024
As of January 2026, FMS confirmed it remains on track.
Subscribe to our newsletter if you enjoy insights like this.
Capital allocation: confident, not defensive
One of the most telling signals of management confidence came through capital allocation.
FMS launched its €1 billion share buyback as part of the “FME Reignite” strategy. The first €600 million tranche was completed ahead of schedule by the end of 2025. In January 2026, the company announced it would accelerate the second tranche, planning to repurchase roughly €415 million of shares by May 2026—completing the entire programme in under a year.
Buybacks alone don’t create value. But accelerating them while leverage is improving usually tells you management believes:
Cash flows are durable, and
The stock is undervalued relative to its intrinsic value.
Alongside the buyback, FMS issued a €500 million bond in November 2025, maturing in 2030 with a 3.25% coupon. This refinancing at reasonable rates suggests continued access to capital markets and creditor confidence.
Leadership changes that look planned, not reactive
Turnarounds often fail when leadership churn signals internal stress. That doesn’t appear to be the case here.
FMS appointed Dr Charles Hugh-Jones as Global Chief Medical Officer effective January 2026, following the planned retirement of a long-serving predecessor. His background in pharma and biotech adds depth to FMS’s clinical and innovation agenda.
At the same time, Joe Turk was appointed CEO of the Care Enablement segment, overseeing dialysis products and technology. This appointment ensures continuity in product innovation and operational efficiency, particularly in home and critical care therapies.
These changes look evolutionary, not disruptive.
Want a concise version of Charlie Munger’s 25 human misjudgements? Download here!
The “FME Reignite” strategy is quietly doing the hard work
FMS’s multi-year FME Reignite programme aims to restore growth while structurally improving profitability.
A core pillar is the FME25+ efficiency programme, targeting over €1 billion in cost savings by 2027. By the first nine months of 2025, FMS had already realised €174 million of incremental savings, close to its full-year target. These savings came from workforce optimisation and clinic streamlining.
The company is also actively optimising its clinic footprint. FMS exited or divested underperforming clinics in markets like Brazil and Malaysia. While these actions slightly reduce reported revenue, they improve overall margins and capital efficiency. As of Q3 2025, FMS operated 3,628 clinics serving around 294,000 patients globally.
Investing beyond traditional dialysis
What’s often missed in short-term market reactions is FMS’s push beyond legacy dialysis.
The company increased its ownership in InterWell Health, investing €312 million to deepen its presence in value-based kidney care models in the U.S. This aligns FMS with long-term healthcare reimbursement trends rather than solely volume-driven treatment.
On the innovation front, FMS rolled out its 5008X CAREsystem in the U.S. and showcased advances in hemodiafiltration and AI-enabled care at ASN Kidney Week 2025. These efforts reinforce FMS’s positioning as a technology-driven healthcare provider, not just a clinic operator.
Regulatory noise vs business reality
There are ongoing regulatory and legal investigations in the U.S. dialysis market, including antitrust scrutiny involving FMS and peers. Importantly, no new material findings or penalties were reported in late 2025, and FMS is cooperating with authorities. These issues are worth monitoring—but they are not new, nor do they appear to have escalated recently.
Final thought
When a share price drops, markets often focus on what’s visible and immediate. Fundamentals, by contrast, move slowly and quietly.
Right now, Fresenius Medical Care looks like a company:
Improving earnings quality
Reducing leverage
Returning capital aggressively
And investing in long-term relevance in kidney care
The market may still be debating the pace of the turnaround. But as an investor, the more important question is whether the direction of travel remains intact.
That’s the question I’ll continue to revisit—long after the short-term price movements fade.
Comments