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Amedisys (AMED) Up 1.9% Since Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for Amedisys, Inc. (AMED - Free Report) . Shares have added about 1.9% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is AMED due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Recent Earnings
Amedisys reported adjusted earnings per share (EPS) from continuing operations of 56 cents in the fourth quarter of 2017, up 27.3% year over year. However, earnings missed the Zacks Consensus Estimate of 59 cents.
Full-year 2017 adjusted EPS came in at $2.21, missing the Zacks Consensus Estimate of $2.24. However, the figure improved from the year-ago number by 42.6%.
Fourth-quarter net service revenues grossed $404.2 million, up 10.3% year over year. The top line also beat the Zacks Consensus Estimate of $395 million.
Net revenues in 2017 totaled $1.53 billion, in line with the Zacks Consensus Estimate. The figure improved 6.3% from the year-ago number.
Quarter in Detail
Within the company's Home Health division, net service revenues totaled $287.3 million in the fourth quarter, reflecting a 7.1% improvement year over year. Medicare revenues of $205 million rose 0.9% year over year, while non-Medicare revenues improved 26.4% year over year to $82.3 million.
Within the Hospice division, net service revenues grossed $98.2 million (up 15.3% year over year), including Medicare revenues of $92.7 million (up 14.9%) and non-Medicare revenues of $5.5 million (up 22.2%).
Recently, the company integrated two additional operating segments within its business — Personal Care and Corporate. At Personal Care, net service revenues totaled $18.7 million, reflecting a 47.2% increase from the year-ago number of $12.7 million.
Meanwhile, Corporate segment did not register any revenue till the end of the fourth quarter.
The company’s gross margin contracted 100 basis points (bps) to 40.9% in the fourth quarter despite a 7.8% increase in gross profit. Expense on salaries and benefits rose 4.6% to $79.4 million. Other expenses dropped 11.8% to $39.8 million. Adjusted operating income of $46.5 million in the reported quarter reflects an increase of 42.2% from the year-ago $32.7 million. Adjusted operating margin expanded 260 bps to 11.5% from the year-ago figure.
Amedisys exited 2017 with cash and cash equivalents of $86.4 million, compared with $30.2 million at the end of 2016. The company's long-term obligations (excluding current portion) were $78.2 million in 2017, down from $87.8 million in 2016. Net cash provided by operating activities in 2017 was $105.7 million, compared with $62.3 million in the year-ago period.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. There have been four revisions higher for the current quarter compared to one lower.
At this time, AMED has a great Growth Score of A, though it is lagging a bit on the momentum front with a B. The stock was also allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is more suitable for growth investors than those looking for value and momentum.
Outlook
Estimates have been broadly trending upward for the stock and the magnitude of these revisions looks promising. Notably, AMED has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Amedisys (AMED) Up 1.9% Since Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Amedisys, Inc. (AMED - Free Report) . Shares have added about 1.9% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is AMED due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Recent Earnings
Amedisys reported adjusted earnings per share (EPS) from continuing operations of 56 cents in the fourth quarter of 2017, up 27.3% year over year. However, earnings missed the Zacks Consensus Estimate of 59 cents.
Full-year 2017 adjusted EPS came in at $2.21, missing the Zacks Consensus Estimate of $2.24. However, the figure improved from the year-ago number by 42.6%.
Fourth-quarter net service revenues grossed $404.2 million, up 10.3% year over year. The top line also beat the Zacks Consensus Estimate of $395 million.
Net revenues in 2017 totaled $1.53 billion, in line with the Zacks Consensus Estimate. The figure improved 6.3% from the year-ago number.
Quarter in Detail
Within the company's Home Health division, net service revenues totaled $287.3 million in the fourth quarter, reflecting a 7.1% improvement year over year. Medicare revenues of $205 million rose 0.9% year over year, while non-Medicare revenues improved 26.4% year over year to $82.3 million.
Within the Hospice division, net service revenues grossed $98.2 million (up 15.3% year over year), including Medicare revenues of $92.7 million (up 14.9%) and non-Medicare revenues of $5.5 million (up 22.2%).
Recently, the company integrated two additional operating segments within its business — Personal Care and Corporate. At Personal Care, net service revenues totaled $18.7 million, reflecting a 47.2% increase from the year-ago number of $12.7 million.
Meanwhile, Corporate segment did not register any revenue till the end of the fourth quarter.
The company’s gross margin contracted 100 basis points (bps) to 40.9% in the fourth quarter despite a 7.8% increase in gross profit. Expense on salaries and benefits rose 4.6% to $79.4 million. Other expenses dropped 11.8% to $39.8 million. Adjusted operating income of $46.5 million in the reported quarter reflects an increase of 42.2% from the year-ago $32.7 million. Adjusted operating margin expanded 260 bps to 11.5% from the year-ago figure.
Amedisys exited 2017 with cash and cash equivalents of $86.4 million, compared with $30.2 million at the end of 2016. The company's long-term obligations (excluding current portion) were $78.2 million in 2017, down from $87.8 million in 2016. Net cash provided by operating activities in 2017 was $105.7 million, compared with $62.3 million in the year-ago period.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. There have been four revisions higher for the current quarter compared to one lower.
Amedisys, Inc. Price and Consensus
Amedisys, Inc. Price and Consensus | Amedisys, Inc. Quote
VGM Scores
At this time, AMED has a great Growth Score of A, though it is lagging a bit on the momentum front with a B. The stock was also allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is more suitable for growth investors than those looking for value and momentum.
Outlook
Estimates have been broadly trending upward for the stock and the magnitude of these revisions looks promising. Notably, AMED has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.