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Amedisys, Inc. (AMED - Free Report) reported adjusted earnings per share (EPS) of $1.00 for the first quarter of 2023, down 18.7% from the year-ago figure. The bottom line surpassed the Zacks Consensus Estimate by 16.3%.
The quarter’s adjustments include certain acquisition and integration costs, clinical optimization and reorganization costs, and executive board of directors/CEO transition awards, among others.
GAAP EPS for the first quarter was 77 cents, down 20.6% year over year.
Meanwhile, net service revenues grossed $556.4 million, up 2% year over year. The top line missed the Zacks Consensus Estimate by 0.6%.
Segments in Detail
Net service revenues of the Home Health Division totaled $343.3 million in the quarter, which showed an improvement of 2.3% year over year. Within this segment, Medicare revenues of $215.4 million were down 3.9% year over year. Non-Medicare revenues increased 14.6% to $127.9 million.
Within the Hospice Division, net service revenues were $193.4 million (down 0.2% year over year), including Medicare revenues of $182.7 million (up 0.1%) and non-Medicare revenues of $10.7 million (up 0.9%).
At Personal Care, net service revenues totaled $15 million, reflecting an increase of 7.1% from the year-ago number.
The High Acuity Care segment reported net service revenues of $4.7 million in the first quarter, a significant 88% surge from the year-ago figure of $2.5 million. The Corporate segment did not register any recognizable revenues in the first quarter.
Margins
The gross profit for the company improved 0.4% to $241.4 million in the quarter under review. Yet, the gross margin contracted 71 basis points (bps) to 43.4%.
Expenses on salaries and benefits rose 2.3% to $126.3 million. Other expenses rose 21.1% to $64.9 million. The adjusted operating profit of $50.1 million reflected a 20.9% decline from the year-ago quarter. The adjusted operating margin contracted 261 bps to 9% from the prior-year level.
Liquidity and Cash Position
Amedisys exited the first quarter with cash and cash equivalents of $49.4 million compared with $40.5 million at 2022-end. The company's long-term obligations (excluding the current portion) were $373.2 million at the end of the first quarter, compared with $419.4 million at the end of 2022.
Cumulative net cash provided by operating activities at the end of the first quarter was $25.9 million compared with $48.6 million a year ago.
2023 Outlook
Amedisys has updated its financial guidance for 2023.
The company anticipates net service revenues for the full year to be in the range of $2.254 billion-$2.274 billion (compared with the earlier range of $2.24 billion-$2.27 billion). The Zacks Consensus Estimate for 2023 revenues is pegged at $2.26 billion.
Adjusted EPS is now projected in the range of $4.14-$4.36 ($4.13-$4.36). The Zacks Consensus Estimate for the same is pegged at $4.25.
Our Take
Amedisys ended the first quarter with better-than-expected earnings and revenues missed the mark.
The year-over-year decline in the Hospice segment’s revenues does not bode well. For the company, dealing with the continuous shortage of clinical labor, nursing in particular, has been challenging. Mounting costs and expenses and contraction in margins are other downsides.
In recent times, the company has kept several growth opportunities in its pipeline. These include progress in direct relationships with health systems, partnering with a leading comprehensive care at-home provider and health plans which are into value-based arrangements for in-home services.
Zacks Rank and Key Picks
Amedisys currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Edwards Lifesciences Corporation (EW - Free Report) , Intuitive Surgical, Inc. (ISRG - Free Report) and Johnson & Johnson (JNJ - Free Report) .
Edwards Lifesciences, carrying a Zacks Rank #2 (Buy), reported first-quarter 2023 adjusted EPS of 62 cents, beating the Zacks Consensus Estimate by 1.6%. Revenues of $1.46 billion outpaced the consensus mark by 4.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Edwards Lifesciences has a long-term estimated growth rate of 6.8%. EW’s earnings surpassed estimates in two of the trailing four quarters, missed the same in one and came in line in the other, the average being 1.2%.
Intuitive Surgical, having a Zacks Rank #2, reported first-quarter 2023 adjusted EPS of $1.23, which beat the Zacks Consensus Estimate by 3.4%. Revenues of $1.70 billion outpaced the consensus mark by 6.9%.
Intuitive Surgical has a long-term estimated growth rate of 13%. ISRG’s earnings surpassed estimates in two of the trailing four quarters and missed the same in the other two, the average surprise being 1.9%.
Johnson & Johnson reported first-quarter 2023 adjusted earnings of $2.68 per share, beating the Zacks Consensus Estimate by 6.8%. Revenues of $24.75 billion surpassed the Zacks Consensus Estimate by 5%. It currently carries a Zacks Rank #2.
Johnson & Johnson has a long-term estimated growth rate of 5.5%. JNJ’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 3.9%.
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Amedisys (AMED) Q1 Earnings Beat Estimates, Margins Dip
Amedisys, Inc. (AMED - Free Report) reported adjusted earnings per share (EPS) of $1.00 for the first quarter of 2023, down 18.7% from the year-ago figure. The bottom line surpassed the Zacks Consensus Estimate by 16.3%.
The quarter’s adjustments include certain acquisition and integration costs, clinical optimization and reorganization costs, and executive board of directors/CEO transition awards, among others.
GAAP EPS for the first quarter was 77 cents, down 20.6% year over year.
Meanwhile, net service revenues grossed $556.4 million, up 2% year over year. The top line missed the Zacks Consensus Estimate by 0.6%.
Segments in Detail
Net service revenues of the Home Health Division totaled $343.3 million in the quarter, which showed an improvement of 2.3% year over year. Within this segment, Medicare revenues of $215.4 million were down 3.9% year over year. Non-Medicare revenues increased 14.6% to $127.9 million.
Within the Hospice Division, net service revenues were $193.4 million (down 0.2% year over year), including Medicare revenues of $182.7 million (up 0.1%) and non-Medicare revenues of $10.7 million (up 0.9%).
Amedisys, Inc. Price, Consensus and EPS Surprise
Amedisys, Inc. price-consensus-eps-surprise-chart | Amedisys, Inc. Quote
At Personal Care, net service revenues totaled $15 million, reflecting an increase of 7.1% from the year-ago number.
The High Acuity Care segment reported net service revenues of $4.7 million in the first quarter, a significant 88% surge from the year-ago figure of $2.5 million. The Corporate segment did not register any recognizable revenues in the first quarter.
Margins
The gross profit for the company improved 0.4% to $241.4 million in the quarter under review. Yet, the gross margin contracted 71 basis points (bps) to 43.4%.
Expenses on salaries and benefits rose 2.3% to $126.3 million. Other expenses rose 21.1% to $64.9 million. The adjusted operating profit of $50.1 million reflected a 20.9% decline from the year-ago quarter. The adjusted operating margin contracted 261 bps to 9% from the prior-year level.
Liquidity and Cash Position
Amedisys exited the first quarter with cash and cash equivalents of $49.4 million compared with $40.5 million at 2022-end. The company's long-term obligations (excluding the current portion) were $373.2 million at the end of the first quarter, compared with $419.4 million at the end of 2022.
Cumulative net cash provided by operating activities at the end of the first quarter was $25.9 million compared with $48.6 million a year ago.
2023 Outlook
Amedisys has updated its financial guidance for 2023.
The company anticipates net service revenues for the full year to be in the range of $2.254 billion-$2.274 billion (compared with the earlier range of $2.24 billion-$2.27 billion). The Zacks Consensus Estimate for 2023 revenues is pegged at $2.26 billion.
Adjusted EPS is now projected in the range of $4.14-$4.36 ($4.13-$4.36). The Zacks Consensus Estimate for the same is pegged at $4.25.
Our Take
Amedisys ended the first quarter with better-than-expected earnings and revenues missed the mark.
The year-over-year decline in the Hospice segment’s revenues does not bode well. For the company, dealing with the continuous shortage of clinical labor, nursing in particular, has been challenging. Mounting costs and expenses and contraction in margins are other downsides.
In recent times, the company has kept several growth opportunities in its pipeline. These include progress in direct relationships with health systems, partnering with a leading comprehensive care at-home provider and health plans which are into value-based arrangements for in-home services.
Zacks Rank and Key Picks
Amedisys currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Edwards Lifesciences Corporation (EW - Free Report) , Intuitive Surgical, Inc. (ISRG - Free Report) and Johnson & Johnson (JNJ - Free Report) .
Edwards Lifesciences, carrying a Zacks Rank #2 (Buy), reported first-quarter 2023 adjusted EPS of 62 cents, beating the Zacks Consensus Estimate by 1.6%. Revenues of $1.46 billion outpaced the consensus mark by 4.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Edwards Lifesciences has a long-term estimated growth rate of 6.8%. EW’s earnings surpassed estimates in two of the trailing four quarters, missed the same in one and came in line in the other, the average being 1.2%.
Intuitive Surgical, having a Zacks Rank #2, reported first-quarter 2023 adjusted EPS of $1.23, which beat the Zacks Consensus Estimate by 3.4%. Revenues of $1.70 billion outpaced the consensus mark by 6.9%.
Intuitive Surgical has a long-term estimated growth rate of 13%. ISRG’s earnings surpassed estimates in two of the trailing four quarters and missed the same in the other two, the average surprise being 1.9%.
Johnson & Johnson reported first-quarter 2023 adjusted earnings of $2.68 per share, beating the Zacks Consensus Estimate by 6.8%. Revenues of $24.75 billion surpassed the Zacks Consensus Estimate by 5%. It currently carries a Zacks Rank #2.
Johnson & Johnson has a long-term estimated growth rate of 5.5%. JNJ’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 3.9%.