Hanger Orthopedic Group Inc

Hanger Orthopedic Group, Inc. (HGR - Analyst Report) recently reported 28% earnings growth and forecasts continue the trend. Shares continue trade at attractive valuations.

Company Description

Hanger Orthopedic Group Inc. develops, acquires and operates orthotic and prosthetic patient-care centers. The Orthotics & Prosthetics centers are staffed by orthotists and prosthetists, who design, fabricate, fit and supervise the use of external musculoskeletal support devices and artificial limbs.

The company also manufacture custom-made and prefabricated Orthotics & Prosthetics devices and are the country's largest distributor of Orthotics & Prosthetics components and finished Orthotics & Prosthetics patient-care products.

Surprises Continue Despite Recession

Hanger announced 28% year-over-year earnings growth when it reported its third-quarter results. Earnings per share were 23 cents, up from 19 cents on year ago. This was the company's fourth consecutive EPS surprise, as Wall Street was looking for just 21 cents.

The company achieved its goal of a 10% increase in sales by reporting $178.7 million, up from $162.3 and just over the target. Cash flow from operations more than doubled to $22.3 million, up from just $10.1 million.

Cheap Growth

Currently, the full-year 2008 and 2009 consensus estimates are 83 cents and 94 cents, respectively. These figures represent year-over-year growth rates of 30% and 14%.

The company's valuations are coming in under its peers. Shares are trading at 17.5 times earnings compared to the industry average of 28.6 times. The PEG ratio is just 1.2 compared to the average of 1.8.

The Chart

Shares of HGR have been bound by support at $13.50 and resistance near $15.00 for the past month. Take a look at the chart below.