Gentiva Beats Zacks Estimate

Gentiva Health Services Inc. (GTIV - Analyst Report) reported a third-quarter (ended Sept. 27, 2009) net income of 54 cents per share, which beat the Zacks Consensus Estimate by 2 cents. Net income per share was 42 cents in the year-ago quarter.

Net revenues for the quarter came in at $295.6 million, as against $345.2 million in the year-ago quarter. Revenues for the reported quarter included net revenues of $75.5 million from the CareCentrix business unit. Excluding the 2008 third quarter net revenues from CareCentrix, Gentiva's net revenues increased about 9% in the reported quarter. On Sept. 25, 2008, Gentiva sold a majority interest in CareCentrix to Water Street Healthcare Partners.

Revenues from the Home Health segment increased 9% to $261.4 million in the reported quarter. Revenues in the All Other segment - which includes hospice, respiratory therapy and home medical equipment, infusion therapy and consulting - came in at $34.6 million, which reflected an increase of 11%.

Selling, general and administrative expenses fell to $126.62 million from $127.9 million in the year-ago quarter. Gentiva exited the quarter with cash, cash equivalents and short-term investments of approximately $125.3 million as against $69.2 million at the end of 2008.

Gentiva has reaffirmed its guidance for the full-year 2009. The company expects 2009 net revenues to come between $1.19 billion to $1.21 billion. The company expects 2009 earnings in the range of $2.04 to $2.10.

Headquartered in Atlanta, GA, Gentiva boasts of a diversified product portfolio. Its product offerings include home health, hospice, respiratory therapies and home medical equipment. The company serves nearly 500,000 patients annually in more than 380 locations across 39 states.

Gentiva has successfully grown through acquisitions. During the past few years, the company has completed multiple acquisitions which have expanded its reach. The company is still on the lookout for other profitable buys. It competes with players such as American Homepatient Inc., Amedisys Inc. (AMED - Snapshot Report) and the privately held Apria Healthcare Group Inc.

We have an Outperform rating on the stock.

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