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Bull of the Day: Amedisys (AMED)

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Amedisys (AMED - Free Report) is a company that provides home health and hospice services throughout the U.S. It offers clinically focused programs for conditions like diabetes, congestive heart failure, orthopedics, and various rehabilitative programs, as well as hospice services to patients using an interdisciplinary care team.

Q3 Earnings Impress

Amedisys’ bottom line surged past the Zacks Consensus Estimate; non-GAAP earnings of $1.15 per share increased 21% year-over-year. Revenue of $495 million came in line with our consensus and grew $18.5% from the prior-year period.

The Home Health segment, which is the company’s biggest revenue generator, hit $311.5 million, up 5.6% year-over-year. Hospice jumped 57% year-over-year, while Personal Care increased 9% to $20.7 million.

“All three of our lines of business continue to grow; we have made great progress integrating the Compassionate Care acquisition; and most importantly, we are once again near the top of the industry in quality for both Home Health and Hospice,” said CEO and president Paul B. Kusserow.

Year-to-date, AMED is up 32%. Estimates have been rising lately too, pushing the stock towards a Zacks Rank #1 (Strong Buy).

For the current fiscal year, Amedisys’ earnings is expected to grow about 21% year-over-year. Eight analysts have revised their estimate upwards in the past 60 days, and the Zacks Consensus Estimate has jumped 23 cents higher from $4.16 to $4.39 per share during the same time frame.

2020 looks strong too, and earnings could see growth of 10.4%; next year’s consensus estimate sits at $4.85 per share, with six upward revisions in the last 60 days.

Bottom Line

Looking ahead, Amedisys expects fiscal 2019 revenue to fall in the range of $1.94 billion and $1.98 billion, and adjusted EPS for the full-year to come in between $4.32 and $4.39 per share.

Because there can be uncertainty when investing in healthcare stocks, management urged “caution in considering the current trends and 2019 guidance.” Amedisys operates in a very competitive space, and an industry that is subject to heavy regulation. Despite intense market fluctuations this year, AMED has proven that it has been able to grow its key business segments. If you’re an investor looking for a broad healthcare stock to add to your portfolio, make sure to keep AMED on your shortlist.

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