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LHC Group (LHCG) Q3 Earnings Match Estimates, Down Y/Y
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LHC Group, Inc. reported third-quarter 2021 adjusted earnings per share (EPS) of $1.45, which matched the Zacks Consensus Estimate. The bottom line declined 11% year over year.
GAAP EPS was 88 cents in the quarter under review, up 91.3% on a year-over-year basis.
Revenue Details
The company reported net service revenues of $565.5 million in the quarter, which beat the Zacks Consensus Estimate by 0.03%. The top line improved 6.6% on a year-over-year basis.
Q3 Highlights
In the quarter under review, total organic growth in home health admissions rose 3.6% year over year, while organic growth in hospice admissions inched up 0.1%.
Home health service revenues were $386.7 million, up 3.5% year over year. Meanwhile, hospice services revenues amounted to $82.7 million, up 38.2%.
Business Update
Presently, LHC Group estimates $300 million of acquired revenues in 2021.
On a year-to-date basis, the company has completed a buyout of around $300 million in annualized revenues. The company’s mergers and acquisitions activity brought its national footprint to 917 locations in 37 states and the District of Columbia.
Margin Analysis
Gross profit in the quarter totaled $221.6 million, down 1.7%. Gross margin in the reported quarter was 39.2%, which contracted 330 basis points (bps) on a year-over-year basis.
Operating profit was $45.1 million, up 131.3% from the prior-year quarter. Operating margin was 7.9%, up 420 bps.
Financial Position
LHC Group exited the third quarter with cash amounting to $29.5 million, down from $112.1 million sequentially.
Cumulative net cash used in operating activities at the end of the third quarter totaled $51.6 million, against net cash provided in operating activities of $455.7 million.
2021 Guidance
LHC Group raised 2021 revenue outlook (representing the completion of the buyout of home health, hospice, and therapy assets from the HCA Healthcare and Brookdale Healthcare Services Venture on Nov 1, 2021) and now anticipates net service revenues between $2.215 billion and $2.220 billion (up from the previously guided range of $2.200-$2.205 billion). The Zacks Consensus Estimate for the same is pegged at $2.21 billion.
The company continues to project adjusted EPS to be $5.75-$5.85. The consensus mark for the same stands at $5.78 per share.
Wrapping Up
LHC Group exited the third quarter on a mixed note, wherein earnings came in line with the Zacks Consensus Estimate but revenues beat the same. The company continues to gain from home health and hospice admissions that witnessed organic growth on a year-over-year basis. On a year-to-date basis, the company has completed a buyout of around $300 million in annualized revenues, which is encouraging. Expansion in operating margin bodes well.
Nevertheless, contraction in gross margin is concerning. Year-over-year decline in the bottom line is a woe. A highly competitive home healthcare market remains a headwind.
Zacks Rank
LHC Group carries a Zacks Rank #5 (Strong Sell).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , West Pharmaceutical Services, Inc. (WST - Free Report) , and AngioDynamics, Inc. (ANGO - Free Report) . While both Thermo Fisher and AngioDynamics sport a Zacks Rank of 1 (Strong Buy), West Pharmaceutical carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher reported third-quarter 2021 adjusted EPS of $5.76, which beat the Zacks Consensus Estimate by 23.3%. Third-quarter revenues of $9.33 billion outpaced the consensus mark by 12%.
West Pharmaceutical reported third-quarter 2021 adjusted EPS of $2.06, which surpassed the Zacks Consensus Estimate by 13.2%. Third-quarter revenues of $706.5 million outpaced the Zacks Consensus Estimate by 3.2%.
AngioDynamics reported first-quarter fiscal 2022 loss per share of 2 cents, narrower than the Zacks Consensus Estimate of a loss of 5 cents. Revenues of $76.9 million surpassed the Zacks Consensus Estimate by 8.4%.
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LHC Group (LHCG) Q3 Earnings Match Estimates, Down Y/Y
LHC Group, Inc. reported third-quarter 2021 adjusted earnings per share (EPS) of $1.45, which matched the Zacks Consensus Estimate. The bottom line declined 11% year over year.
GAAP EPS was 88 cents in the quarter under review, up 91.3% on a year-over-year basis.
Revenue Details
The company reported net service revenues of $565.5 million in the quarter, which beat the Zacks Consensus Estimate by 0.03%. The top line improved 6.6% on a year-over-year basis.
Q3 Highlights
In the quarter under review, total organic growth in home health admissions rose 3.6% year over year, while organic growth in hospice admissions inched up 0.1%.
Home health service revenues were $386.7 million, up 3.5% year over year. Meanwhile, hospice services revenues amounted to $82.7 million, up 38.2%.
Business Update
Presently, LHC Group estimates $300 million of acquired revenues in 2021.
LHC Group, Inc. Price, Consensus and EPS Surprise
LHC Group, Inc. price-consensus-eps-surprise-chart | LHC Group, Inc. Quote
On a year-to-date basis, the company has completed a buyout of around $300 million in annualized revenues. The company’s mergers and acquisitions activity brought its national footprint to 917 locations in 37 states and the District of Columbia.
Margin Analysis
Gross profit in the quarter totaled $221.6 million, down 1.7%. Gross margin in the reported quarter was 39.2%, which contracted 330 basis points (bps) on a year-over-year basis.
Operating profit was $45.1 million, up 131.3% from the prior-year quarter. Operating margin was 7.9%, up 420 bps.
Financial Position
LHC Group exited the third quarter with cash amounting to $29.5 million, down from $112.1 million sequentially.
Cumulative net cash used in operating activities at the end of the third quarter totaled $51.6 million, against net cash provided in operating activities of $455.7 million.
2021 Guidance
LHC Group raised 2021 revenue outlook (representing the completion of the buyout of home health, hospice, and therapy assets from the HCA Healthcare and Brookdale Healthcare Services Venture on Nov 1, 2021) and now anticipates net service revenues between $2.215 billion and $2.220 billion (up from the previously guided range of $2.200-$2.205 billion). The Zacks Consensus Estimate for the same is pegged at $2.21 billion.
The company continues to project adjusted EPS to be $5.75-$5.85. The consensus mark for the same stands at $5.78 per share.
Wrapping Up
LHC Group exited the third quarter on a mixed note, wherein earnings came in line with the Zacks Consensus Estimate but revenues beat the same. The company continues to gain from home health and hospice admissions that witnessed organic growth on a year-over-year basis. On a year-to-date basis, the company has completed a buyout of around $300 million in annualized revenues, which is encouraging. Expansion in operating margin bodes well.
Nevertheless, contraction in gross margin is concerning. Year-over-year decline in the bottom line is a woe. A highly competitive home healthcare market remains a headwind.
Zacks Rank
LHC Group carries a Zacks Rank #5 (Strong Sell).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , West Pharmaceutical Services, Inc. (WST - Free Report) , and AngioDynamics, Inc. (ANGO - Free Report) . While both Thermo Fisher and AngioDynamics sport a Zacks Rank of 1 (Strong Buy), West Pharmaceutical carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher reported third-quarter 2021 adjusted EPS of $5.76, which beat the Zacks Consensus Estimate by 23.3%. Third-quarter revenues of $9.33 billion outpaced the consensus mark by 12%.
West Pharmaceutical reported third-quarter 2021 adjusted EPS of $2.06, which surpassed the Zacks Consensus Estimate by 13.2%. Third-quarter revenues of $706.5 million outpaced the Zacks Consensus Estimate by 3.2%.
AngioDynamics reported first-quarter fiscal 2022 loss per share of 2 cents, narrower than the Zacks Consensus Estimate of a loss of 5 cents. Revenues of $76.9 million surpassed the Zacks Consensus Estimate by 8.4%.