Top Performer for Tuesday: Providence Service (PRSC)

The Providence Service Corporation (PRSC - Snapshot Report) announced today that it expects record earnings for its second quarter, which the company will release during the week of Aug 9.

The news helped shares gain approximately 4% on another tough day for the market. Due to the difficult environment today, the advance is enough for PRSC to reach the Zacks #1 Rank Top Performers List on Tuesday.

PRSC, through owned and managed entities, provides home and community-based social services and non-emergency transportation services management to government-sponsored clients under programs such as welfare, juvenile justice, Medicaid and corrections.

Q2 EPS to Rise 33% ... At Least

Thanks to improved operating results in April and May, PRSC now expects earnings per share of at least 36 cents in the second quarter, which is more than 30% better than the year-ago result of 27 cents.

The new guidance is currently 2 cents shy of the consensus at 38 cents, but offers a good shot of matching or beating expectations in August - especially if that guidance is conservative, as "at least" suggests.

"The payer environment continues to stabilize, Medicaid enrollment is increasing, and the benefits of recent cost-cutting programs continued to enhance our results in the second quarter," said Chairman and CEO Fletcher McCusker.

Earnings Estimates Waiting for Results?

PRSC was last featured as a Zacks #1 Rank Top Performer on May 12; shortly after its first-quarter report. Earnings estimates haven't changed much in the past several weeks, but remain above levels from 2 months ago by 49% for this year.

Meanwhile, in that time, expectations for next year have jumped 41% to $1.48, which is currently 13% ahead of this year's estimate at $1.31.

Even the 38 cents expected for its second quarter has gained in the last 2 months, moving more than 58% from 24 cents.

A Lot to Live Up To

PRSC's first-quarter performance, announced on May 6, was very solid, and not only sparked higher earnings estimates, but also gave the company its second shot on the top performers list in 3 weeks.

Revenue in the quarter grew 7.5% year over year to $186.7 million from $173.7 million. Revenue for the social services segment and non-emergency transportation services business gained 9.1% and 6.2%, respectively.

Excluding items, earnings per share reached 58 cents, which handily eclipsed the year-ago result of 29 cents while also bettering the consensus by more than 93%.

The company has now beaten Wall Street's earnings estimates in 3 out of the last 4 quarters.

A Broad Industry

PRSC is part of the Business Services industry, which encompasses a wide array of companies. On today's 222-stock Zacks #1 Rank List, there are 5 other companies from this space, including Iron Mountain (IRM - Analyst Report) and Visa (V - Snapshot Report).