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Pediatrix Medical Group, Inc. (MD) Up 11% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for Pediatrix Medical Group (MD - Free Report) . Shares have added about 11% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Pediatrix Medical Group, Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Pediatrix's Q4 Earnings Miss Due to Soft Patient Volumes
Pediatrix Medical reported a fourth-quarter 2023 adjusted earnings per share (EPS) of 32 cents, which matched the Zacks Consensus Estimate. The bottom line plunged 31.9% year over year.
Net revenues of $496.4 million slipped 3.4% year over year due to the impact of non-same-unit activity and lower same-unit revenues. The top line missed the consensus mark by 4.9%.
The quarterly results suffered a blow due to a decline in patient volumes, an elevated expense level and the adverse impact of an aggregate non-cash impairment loss related to goodwill and other assets. Nevertheless, the downside was partly offset by a favorable payor mix.
Q4 Update
Overall same-unit revenues fell 1.5% year over year in the fourth quarter. Same-unit revenues attributable to patient volume decreased 1% year over year.
Same-unit revenues from net reimbursement-related factors dipped 0.5% year over year due to the effect of the financial support received from Pediatrix’s revenue cycle management vendor in the year-ago quarter. Nevertheless, the downside was partly offset by moderate growth in hospital contract administrative fees and payor mix.
Total operating expenses of Peditrix Medical escalated 27.2% year over year to $607.9 million in the quarter under review, higher than our estimate of $480.4 million. The year-over-year increase was due to a rise in practice supplies and other operating expenses, general and administrative expenses, and the recording of a goodwill impairment cost.
General and administrative expenses rose 3.9% year over year to $53.1 million but was lower than our estimate of $57.8 million.
Interest expenses increased 1.3% year over year to $10.1 million due to increased interest rates on the company’s adjustable-rate borrowings, which beat our estimate of $9.9 million.
Adjusted EBITDA of $50.8 million tumbled 23.6% year over year and lagged our estimate of $52 million.
Financial Update (as of Dec 31, 2023)
Pediatrix exited the fourth quarter with cash and cash equivalents of $73.3 million, which increased more than seven-fold from the 2022 end figure.
Total assets of $2.2 billion dropped 5.5% from the figure at 2022 end.
Total debt, net, amounted to $633.3 million, down 2.8% from the figure as of Dec 31, 2022.
Total shareholders’ equity of $849.1 million declined 4.8% from the level at 2022 end.
2024 View Unveiled
Management anticipates adjusted EBITDA to lie between $200 million and $220 million, the mid-point of which indicates a 4.8% improvement from the 2023 figure of $200.4 million.
Interest expense is projected within $39.9-$40.6 million for 2024, the mid-point of which suggests a 4.4% fall from the 2023 figure of $42.1 million.
Depreciation and amortization expenses are estimated at $39 million. Transformation and restructuring related expenses are anticipated at $25 million. Income tax expense is forecasted to stay within $26.65-$32.40 million.
Income from continuing operations attributable to Pediatrix Medical is expected to lie between $68.75 million and $83.70 million in 2024.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -24.09% due to these changes.
VGM Scores
At this time, Pediatrix Medical Group, Inc. has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Pediatrix Medical Group, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Pediatrix Medical Group, Inc. is part of the Zacks Medical Services industry. Over the past month, Avantor, Inc. (AVTR - Free Report) , a stock from the same industry, has gained 5.6%. The company reported its results for the quarter ended December 2023 more than a month ago.
Avantor reported revenues of $1.72 billion in the last reported quarter, representing a year-over-year change of -4%. EPS of $0.25 for the same period compares with $0.32 a year ago.
Avantor is expected to post earnings of $0.20 per share for the current quarter, representing a year-over-year change of -31%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Avantor has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.
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Pediatrix Medical Group, Inc. (MD) Up 11% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Pediatrix Medical Group (MD - Free Report) . Shares have added about 11% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Pediatrix Medical Group, Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Pediatrix's Q4 Earnings Miss Due to Soft Patient Volumes
Pediatrix Medical reported a fourth-quarter 2023 adjusted earnings per share (EPS) of 32 cents, which matched the Zacks Consensus Estimate. The bottom line plunged 31.9% year over year.
Net revenues of $496.4 million slipped 3.4% year over year due to the impact of non-same-unit activity and lower same-unit revenues. The top line missed the consensus mark by 4.9%.
The quarterly results suffered a blow due to a decline in patient volumes, an elevated expense level and the adverse impact of an aggregate non-cash impairment loss related to goodwill and other assets. Nevertheless, the downside was partly offset by a favorable payor mix.
Q4 Update
Overall same-unit revenues fell 1.5% year over year in the fourth quarter. Same-unit revenues attributable to patient volume decreased 1% year over year.
Same-unit revenues from net reimbursement-related factors dipped 0.5% year over year due to the effect of the financial support received from Pediatrix’s revenue cycle management vendor in the year-ago quarter. Nevertheless, the downside was partly offset by moderate growth in hospital contract administrative fees and payor mix.
Total operating expenses of Peditrix Medical escalated 27.2% year over year to $607.9 million in the quarter under review, higher than our estimate of $480.4 million. The year-over-year increase was due to a rise in practice supplies and other operating expenses, general and administrative expenses, and the recording of a goodwill impairment cost.
General and administrative expenses rose 3.9% year over year to $53.1 million but was lower than our estimate of $57.8 million.
Interest expenses increased 1.3% year over year to $10.1 million due to increased interest rates on the company’s adjustable-rate borrowings, which beat our estimate of $9.9 million.
Adjusted EBITDA of $50.8 million tumbled 23.6% year over year and lagged our estimate of $52 million.
Financial Update (as of Dec 31, 2023)
Pediatrix exited the fourth quarter with cash and cash equivalents of $73.3 million, which increased more than seven-fold from the 2022 end figure.
Total assets of $2.2 billion dropped 5.5% from the figure at 2022 end.
Total debt, net, amounted to $633.3 million, down 2.8% from the figure as of Dec 31, 2022.
Total shareholders’ equity of $849.1 million declined 4.8% from the level at 2022 end.
2024 View Unveiled
Management anticipates adjusted EBITDA to lie between $200 million and $220 million, the mid-point of which indicates a 4.8% improvement from the 2023 figure of $200.4 million.
Interest expense is projected within $39.9-$40.6 million for 2024, the mid-point of which suggests a 4.4% fall from the 2023 figure of $42.1 million.
Depreciation and amortization expenses are estimated at $39 million. Transformation and restructuring related expenses are anticipated at $25 million. Income tax expense is forecasted to stay within $26.65-$32.40 million.
Income from continuing operations attributable to Pediatrix Medical is expected to lie between $68.75 million and $83.70 million in 2024.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -24.09% due to these changes.
VGM Scores
At this time, Pediatrix Medical Group, Inc. has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Pediatrix Medical Group, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Pediatrix Medical Group, Inc. is part of the Zacks Medical Services industry. Over the past month, Avantor, Inc. (AVTR - Free Report) , a stock from the same industry, has gained 5.6%. The company reported its results for the quarter ended December 2023 more than a month ago.
Avantor reported revenues of $1.72 billion in the last reported quarter, representing a year-over-year change of -4%. EPS of $0.25 for the same period compares with $0.32 a year ago.
Avantor is expected to post earnings of $0.20 per share for the current quarter, representing a year-over-year change of -31%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Avantor has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.