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Amedisys (AMED) Q1 Earnings, Revenues Beat on Overall Growth
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Amedisys, Inc. (AMED - Free Report) reported earnings per share (EPS) of 79 cents in the first quarter of 2018, up 68.1% from the year-ago adjusted EPS of 47 cents. The bottom line also remained well ahead of the Zacks Consensus Estimate of 66 cents.
First-quarter net service revenues grossed $399.3 million, up 9.5% year over year. The top line also beat the Zacks Consensus Estimate of $397 million.
Quarter in Detail
Within the company's Home Health division, net service revenues totaled $284.1 million in the first quarter, reflecting a 6.2% improvement year over year. Medicare revenues of $205 million rose 3.2% year over year while non-Medicare revenues improved 14.8% year over year to $79.1 million.
Within the Hospice division, net service revenues grossed $97.3 million (up 16.4% year over year) including Medicare revenues of $91.8 million (up 13.8%) and non-Medicare revenues of $5.5 million (up 89.7%).
Recently, the company integrated two additional operating segments within its business, namely Personal Care and Corporate. At Personal Care, net service revenues totaled $17.9 million, representing a 32.6% increase from the year-ago number. Meanwhile, the Corporate segment did not register any revenues till the end of the first quarter.
The company’s gross margin contracted 36 basis points (bps) to 40.3% in the quarter under review despite an 8.5% climb in gross profit. Expense on salaries and benefits inched up 1.6% to $75.6 million. Other expenses rose 3.1% to $41.7 million. Adjusted operating income of $43.6 million in the reported quarter reflects a surge of 30.4% from the year-ago tally. Adjusted operating margin expanded 176 bps to 10.9% from the year-ago figure.
Amedisys exited the first quarter of 2018 with cash and cash equivalents of $120 million compared with $86.3 million at the end of 2017. The company's long-term obligations (excluding current portion) were $75.8 million at the end of the first quarter, down from $78.2 million as of Dec 31, 2017. Net cash provided by operating activities in the first three months of 2018 was $40.3 million compared with $27.1 million in the year-ago period.
Our Take
Amedisys ended the first quarter on a promising note with both earnings and revenues exceeding the respective Zacks Consensus Estimate. At the Home Health and Hospice divisions, the company witnessed encouraging growth in Medicare and non-Medicare revenues. Amedisys is currently exploring opportunities in these segments. We are also impressed by the company’s solid performance in the recently launched Personal Care segment. A favorable demographic trend and strategic acquisitions also bode well for the company.
However, escalating operating expenses and a declining gross margin continue to raise concerns. Also, an intense competitive landscape and regulatory concerns persistently pose challenges to the home health and hospice industry.
Zacks Rank & Key Picks
Amedisys carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader medical space having reported robust earnings figures this reporting cycle are Intuitive Surgical (ISRG - Free Report) , Chemed Corp. (CHE - Free Report) and Baxter International Inc. (BAX - Free Report) . While Intuitive Surgical sports a Zacks Rank #1 (Strong Buy), Chemed and Baxter carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuitive Surgical reported first-quarter 2018 adjusted EPS of $2.44, which beat the Zacks Consensus Estimate by 22.6%. Revenues totaled $848 million, also surpassing the consensus estimate by 10.6%.
Chemed posted first-quarter 2018 adjusted EPS of $2.72, outpacing the Zacks Consensus Estimate of $2.37. Revenues came in at $439.2 million, higher than the Zacks Consensus Estimate of $420 million.
Baxter’s first-quarter 2018 adjusted EPS of 70 cents bettered the Zacks Consensus Estimate by 12.9%. Revenues of $2.68 billion also edged past the consensus mark of $2.62 billion.
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Amedisys (AMED) Q1 Earnings, Revenues Beat on Overall Growth
Amedisys, Inc. (AMED - Free Report) reported earnings per share (EPS) of 79 cents in the first quarter of 2018, up 68.1% from the year-ago adjusted EPS of 47 cents. The bottom line also remained well ahead of the Zacks Consensus Estimate of 66 cents.
First-quarter net service revenues grossed $399.3 million, up 9.5% year over year. The top line also beat the Zacks Consensus Estimate of $397 million.
Quarter in Detail
Within the company's Home Health division, net service revenues totaled $284.1 million in the first quarter, reflecting a 6.2% improvement year over year. Medicare revenues of $205 million rose 3.2% year over year while non-Medicare revenues improved 14.8% year over year to $79.1 million.
Amedisys, Inc. Price, Consensus and EPS Surprise
Amedisys, Inc. Price, Consensus and EPS Surprise | Amedisys, Inc. Quote
Within the Hospice division, net service revenues grossed $97.3 million (up 16.4% year over year) including Medicare revenues of $91.8 million (up 13.8%) and non-Medicare revenues of $5.5 million (up 89.7%).
Recently, the company integrated two additional operating segments within its business, namely Personal Care and Corporate. At Personal Care, net service revenues totaled $17.9 million, representing a 32.6% increase from the year-ago number. Meanwhile, the Corporate segment did not register any revenues till the end of the first quarter.
The company’s gross margin contracted 36 basis points (bps) to 40.3% in the quarter under review despite an 8.5% climb in gross profit. Expense on salaries and benefits inched up 1.6% to $75.6 million. Other expenses rose 3.1% to $41.7 million. Adjusted operating income of $43.6 million in the reported quarter reflects a surge of 30.4% from the year-ago tally. Adjusted operating margin expanded 176 bps to 10.9% from the year-ago figure.
Amedisys exited the first quarter of 2018 with cash and cash equivalents of $120 million compared with $86.3 million at the end of 2017. The company's long-term obligations (excluding current portion) were $75.8 million at the end of the first quarter, down from $78.2 million as of Dec 31, 2017. Net cash provided by operating activities in the first three months of 2018 was $40.3 million compared with $27.1 million in the year-ago period.
Our Take
Amedisys ended the first quarter on a promising note with both earnings and revenues exceeding the respective Zacks Consensus Estimate. At the Home Health and Hospice divisions, the company witnessed encouraging growth in Medicare and non-Medicare revenues. Amedisys is currently exploring opportunities in these segments. We are also impressed by the company’s solid performance in the recently launched Personal Care segment. A favorable demographic trend and strategic acquisitions also bode well for the company.
However, escalating operating expenses and a declining gross margin continue to raise concerns. Also, an intense competitive landscape and regulatory concerns persistently pose challenges to the home health and hospice industry.
Zacks Rank & Key Picks
Amedisys carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader medical space having reported robust earnings figures this reporting cycle are Intuitive Surgical (ISRG - Free Report) , Chemed Corp. (CHE - Free Report) and Baxter International Inc. (BAX - Free Report) . While Intuitive Surgical sports a Zacks Rank #1 (Strong Buy), Chemed and Baxter carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuitive Surgical reported first-quarter 2018 adjusted EPS of $2.44, which beat the Zacks Consensus Estimate by 22.6%. Revenues totaled $848 million, also surpassing the consensus estimate by 10.6%.
Chemed posted first-quarter 2018 adjusted EPS of $2.72, outpacing the Zacks Consensus Estimate of $2.37. Revenues came in at $439.2 million, higher than the Zacks Consensus Estimate of $420 million.
Baxter’s first-quarter 2018 adjusted EPS of 70 cents bettered the Zacks Consensus Estimate by 12.9%. Revenues of $2.68 billion also edged past the consensus mark of $2.62 billion.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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