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, 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.
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.
See the pot trades we're targeting>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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