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PharMerica Takes Over CareMed, Expands in Specialty Pharmacy
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In an initiative to diversify its business strategy, leading provider of institutional and hospital pharmacy management services, PharMerica Corporation recently announced the acquisition of CareMed Specialty Pharmacy, a leading provider of specialty pharmacy services. However, all the other terms of the deal have been kept under wraps.
The acquisition pipeline of PharMerica has been a major driving force with the company actively pursuing deals in the institutional core and diversified business segments. In the last reported quarter, the company acquired Express Care and Stanley LTC Pharmacy in the institutional pharmacy business segment.
Getting back to the news, NY-based CareMed is renowned for its ‘commitment to excellence and customer service’. Per management, the acquisition will fortify the company’s market position in the rapidly growing specialty pharmacy market.
Stock Performance
The price performance of PharMerica has been a little disappointing of late. Over the last three months, the stock lost 11.6%, comparing unfavorably with the Zacks classified Medical-Outpatient and Home Healthcare sub-industry’s gain of roughly 4.8%. Furthermore, the current return of the stock is below the S&P 500’s 5.7% over the same time frame. The stock followed the dismal price trend and plunged 1.8% to $22.10 on Mar 16, following the news release.
Coming to the estimate revision trend of the stock, three estimates moved south in the last two months compared to no movement in the opposite direction for the full year. As a result, the current year estimate dropped 13.7% to $1.89 per share over the same time frame. This justifies the stock’s Zacks Rank #5 (Strong Sell).
Bottom Line
PharMerica serves in the long-term care, hospital pharmacy management services, specialty home infusion and oncology pharmacy markets. The company’s keen interest in bolstering its hold in the specialty pharmacy markets is encouraging.
Acquisitions contributed roughly $100 million to the company’s top line in fiscal 2016. For fiscal 2017, the company expects to garner $200 million from the buyouts. The company expects 70% of revenues from the diversified pharmacy segment and 30% from the institutional pharmacy businesses.
Notably, the specialty pharmacy services industry has always been a safe haven for investors looking for steady growth. However, things have been quite different of late, courtesy of an aging American population and cut-throat competition in niche markets.
Inogen has a long-term expected earnings growth rate of 17.05%. Notably, the stock represents an impressive one-year return of 81.6%.
Avinger projects sales growth of 30.6% for the current year. Additionally, the company posted a positive earnings surprise of 27% in the last quarter.
Fluidigm Corporation has a long-term expected earnings growth rate of 25%. The stock posted a positive earnings surprise of 1.6% in the last reported quarter.
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PharMerica Takes Over CareMed, Expands in Specialty Pharmacy
In an initiative to diversify its business strategy, leading provider of institutional and hospital pharmacy management services, PharMerica Corporation recently announced the acquisition of CareMed Specialty Pharmacy, a leading provider of specialty pharmacy services. However, all the other terms of the deal have been kept under wraps.
The acquisition pipeline of PharMerica has been a major driving force with the company actively pursuing deals in the institutional core and diversified business segments. In the last reported quarter, the company acquired Express Care and Stanley LTC Pharmacy in the institutional pharmacy business segment.
Getting back to the news, NY-based CareMed is renowned for its ‘commitment to excellence and customer service’. Per management, the acquisition will fortify the company’s market position in the rapidly growing specialty pharmacy market.
Stock Performance
The price performance of PharMerica has been a little disappointing of late. Over the last three months, the stock lost 11.6%, comparing unfavorably with the Zacks classified Medical-Outpatient and Home Healthcare sub-industry’s gain of roughly 4.8%. Furthermore, the current return of the stock is below the S&P 500’s 5.7% over the same time frame. The stock followed the dismal price trend and plunged 1.8% to $22.10 on Mar 16, following the news release.
Coming to the estimate revision trend of the stock, three estimates moved south in the last two months compared to no movement in the opposite direction for the full year. As a result, the current year estimate dropped 13.7% to $1.89 per share over the same time frame. This justifies the stock’s Zacks Rank #5 (Strong Sell).
Bottom Line
PharMerica serves in the long-term care, hospital pharmacy management services, specialty home infusion and oncology pharmacy markets. The company’s keen interest in bolstering its hold in the specialty pharmacy markets is encouraging.
Acquisitions contributed roughly $100 million to the company’s top line in fiscal 2016. For fiscal 2017, the company expects to garner $200 million from the buyouts. The company expects 70% of revenues from the diversified pharmacy segment and 30% from the institutional pharmacy businesses.
Pharmerica Corporation Price
Pharmerica Corporation Price | Pharmerica Corporation Quote
Notably, the specialty pharmacy services industry has always been a safe haven for investors looking for steady growth. However, things have been quite different of late, courtesy of an aging American population and cut-throat competition in niche markets.
Stocks to Consider
Better-ranked stocks in the broader medical sector include Inogen Inc. (INGN - Free Report) , Avinger, Inc. (AVGR - Free Report) and Fluidigm Corporation . Notably, Inogen sports a Zacks Rank #1 (Strong Buy) while Fluidigm and Avinger carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Inogen has a long-term expected earnings growth rate of 17.05%. Notably, the stock represents an impressive one-year return of 81.6%.
Avinger projects sales growth of 30.6% for the current year. Additionally, the company posted a positive earnings surprise of 27% in the last quarter.
Fluidigm Corporation has a long-term expected earnings growth rate of 25%. The stock posted a positive earnings surprise of 1.6% in the last reported quarter.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>