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Amedisys (AMED) to Buy VNA Hospice, Home Health, Expand in NE

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Amedisys (AMED - Free Report) recently entered into an acquisition deal to purchase the home health and hospice care operations of non-profit Visiting Nurse Association (VNA). Financial terms of the deal have not been disclosed. The  transaction is expected to close on or around Jul 1, 2021.

This acquisition is expected to strengthen Amedisys’ home health and hospice care network across Nebraska and Iowa, the two regions, which are VNA’s base.

A Few Words on VNA

VNA, with an experience of 125 years, currently has a team of more than 400 healthcare professionals. The company delivers quality home health and hospice care in Omaha, NE and Council Bluffs, IA.

Once the acquisition is complete, leveraging on VNA’s home health and hospice care legacy, Amedisys expects to provide additional scale and resources. This is expected to broaden Amedisys’ patient base as well as increase the company’s opportunities to expand home health services to more communities across Nebraska and Iowa. 

During the time of the unprecedented healthcare crisis, we believe this latest investment by Amedisys in the growing space of home health and hospice might prove to be strategic and well timed. This is going to expand Amedisys’ presence in Omaha and Council Bluffs’ healthcare communities.

Amedisys' Important Strategic Pacts in Recent Times

Amedisys is developing and acquiring new business lines that will complement its existing home care and hospice business and help seniors manage their health more effectively and stay in their homes longer.

In April 2021, the company signed a definitive agreement to acquire regulatory assets that allow the company to conduct home health care operations in Randolph County, NC. In January, Amedisys collaborated with an alternate site infusion services provider to offer COVID-19 antibody infusion therapy within skilled nursing and assisted living facilities, collectively referred to as “long term care facilities”.

In October 2020, Amedisys entered into a care coordination agreement with BrightStar Care to add its agencies to the Amedisys Personal Care Network, which helps facilitate the coordination of care between Amedisys’ hospice and home health care centers, and a network of personal care partners.

In June 2020, the company closed the acquisition of AseraCare Hospice, a national hospice care provider with an executive office in Plano, TX and administrative support center in Fort Smith, AK.

Currently, management expects the company to have enough cash balance to make a number of such acquisitions and alliances in the future.

Industry Prospects

The home health industry is poised for tremendous growth in the long term, driven by the aging U.S. population, and patients’ desire for independence and home health as a reasonable care modality. Per a report by Grand View Research, the global home healthcare market size was valued at $281.8 billion in 2019 and is expected to see a CAGR of 7.9% by 2027.

Price Performance

Shares of the company have gained 44.6% in a year’s time compared with the industry’s growth of 28.9%.

Zacks Rank and Other Key Picks

Currently, Amedisys carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader medical space are Owens & Minor, Inc. (OMI - Free Report) , Boston Scientific Corporation (BSX - Free Report) and West Pharmaceutical Services, Inc. (WST - Free Report) .

Owens & Minor’s long-term expected earnings growth rate is 15.1%. It currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Boston Scientific has a projected long-term earnings growth rate of 9.3%. It currently carries a Zacks Rank #2.

West Pharmaceutical’s long-term projected earnings growth rate is pegged at 22.6%. The company too carries a Zacks Rank #2.

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