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The Joint (JYNT) Acquires 4 Franchised Facilities, Down 5%

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Shares of The Joint Corp. (JYNT - Free Report) declined 5% yesterday (on May 23) after management announced an acquisition worth $5.8 million. On May 19, JYNT purchased four previously-owned franchised facilities.  

JYNT expects the move to boost its footprint in Scottsdale, which is part of the Phoenix metropolitan region. The Joint has a cluster of 20 corporate clinics in the region. Hence, accommodating the acquired clinics in its portfolio will be fast. JYNT anticipates the acquisitions to be accretive to the bottom line immediately.

The Joint anticipates the valuation of this new acquisition to be in line with its previous purchases. The move is expected to increase JYNT’s patient visits immediately. JYNT witnesses almost 11 million patient visits per annum and operates in more than 700 locations in the country. It is focused on expanding its portfolio with quality acquisitions.

Last month, The Joint acquired regional developer rights for the Northern California region. The medical care facility provider got the rights for $2.4 million. JYNT expects the region to hold 75 clinics, including its right to oversee 56 franchisee clinics, of which 36 are in the active development phase while 20 are currently operating.

In March this year, JYNT inked a deal to acquire the regional developer territory of Northern New Jersey. By 2023 end, The Joint aims to open a total of 1,000 clinics. It intends to achieve the target through new greenfield projects and franchise clinic openings.

Nevertheless, the stock has been tumbling since management released disappointing first-quarter earnings results and lowered its guidance for 2022. The Joint faced several downgrades by analysts post earnings announcement. The Zacks Consensus Estimate for current-year earnings is pegged at 16 cents per share, indicating a decline of 66.7% from the year-ago reported figure. The bottom line has witnessed two downward movements in the past 30 days against none in the opposite direction.

Price Performance

Shares of JYNT have declined 73.3% in the past year against a 16.2% rise of the industry it belongs to.

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Zacks Rank & Key Picks

The Joint currently has a Zacks Rank #4 (Sell).

Some better-ranked stocks in the medical space are Select Medical Holdings Corporation (SEM - Free Report) , Omega Therapeutics, Inc. (OMGA - Free Report) and Progyny, Inc. (PGNY - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Select Medical’s earnings indicates a 28.6% increase from the year-ago reported figure. SEM has witnessed one upward estimate revision in the past 30 days against none in the opposite direction.

Select Medical’s earnings beat estimates in each of the last four quarters, the average being 42%.

The Zacks Consensus Estimate for Omega Therapeutics’ earnings indicates a 28.9% increase from the prior-year reported number. OMGA has witnessed three upward estimate revisions and no downward movement in the past 30 days.

Omega Therapeutics’ earnings beat estimates twice in the last four quarters and missed the mark on the other two occasions. 

The consensus estimate for Progyny’s 2022 bottom line has significantly improved in the past 30 days. PGNY has witnessed two upward estimate revisions during this time against none in the opposite direction.

Progyny’s earnings beat estimates in each of the last four quarters, the average being 169.7%.