SXC Health Solutions Corp.

Company Description

SXC Health Solutions Corp. provides pharmacy benefit management services and healthcare information technology solutions in North America. The company was founded in 1993 and has a market cap of $594 million.

First-Quarter Results

SXC gave its share price a boost on May 7 when the company reported better than expected first-quarter results on May 7.

Revenue was up more than 1200% from last year to $291 million, helped by an acquisition and new contracts. Income came in at $7.7 million, producing earnings of 38 cents per share, 21 cents of the consensus estimate.

SXC has beat in each of the last four quarters by an average of 9 cents, or 71%.

Guidance

Looking forward, SXC said it expects full-year earnings of $1.13 to $1.21 per share on sales between $1.25 billion to $1.35 billion.

Valuations

Based upon the low-end of the range, this stock does look a bit pricey, carrying a P/E multiple of more than 21X, a steep premium to the overall market.

The Chart

Shares of SXC have been locked into a nice rally since October of last year after bottoming out just above $10. Since then, this stock has crossed the $24 mark, an impressive short-term return of more than 100%. Take a look at the chart below.