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Amedisys (AMED) Up 3.6% Since Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Amedisys Inc (AMED - Free Report) . Shares have added about 3.6% in the past month.

Will the recent positive trend continue leading up to the stock's next earnings release, or is it 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 catalysts.

Recent Earnings

Amedisys reported adjusted earnings from continuing operations of $0.47 per share in the second quarter of 2017, up 47.6% year over year. However, earnings missed the Zacks Consensus Estimate of $0.50.

Excluding adjustments, the company reported earnings of $0.13 a share, reflecting a 59.4% decline from the year-ago quarter.

Second-quarter net service revenues grossed $378.8 million, up 5% year over year. The top line however missed the Zacks Consensus Estimate of $380.62 million.

Quarter in Detail

Within the company's Home Health division, net service revenues totaled $273.7 million (down 0.7%) in the second quarter. Medicare revenues of $198.3 million declined 4.8% year over year, while non-Medicare revenues improved 12.4% year over year to $75.4 million.

Within the Hospice division, net service revenues grossed $90.7 million (up 19.7% year over year), including Medicare revenues of $85.8 million (up 20.3%) and non-Medicare revenues of $4.9 million (up 8.9%).

Recently, the company integrated two additional operating segments within its business – Personal Care and Corporate. At Personal Care, net service revenues totaled $14.4 million, reflecting a 53.2% increase from year-ago number of $9.4 million.

Corporate, on the other hand, did not register any revenue till the end of the second quarter.

The company’s gross margin contracted 90 basis points (bps) to 41.9% in the second quarter, while gross profit rose 3.1%. Expense on salaries and benefits declined 3.1% to $74.9 million. Other expenses also dropped 8.8% to $41.6 million. Adjusted operating income of $42.5 million in the reported quarter reflects an increase of 35.8% from the year-ago adjusted operating income of $31.3 million. Operating margin expanded 250 bps to 11.2% from the year-ago figure.

Amedisys exited the second quarter with cash and cash equivalents of $59.2 million, compared with $48.3 million at the end of the preceding quarter. The company's long-term obligations (excluding current portion) were $83.2 million in the reported quarter, down from $87.8 million in the year-ago quarter. Year-to-date net cash provided by operating activities was $63.3 million, compared with $26.9 million in the year-ago period.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the past month as none of them issued any earnings estimate revisions.

Amedisys Inc Price and Consensus

 

Amedisys Inc Price and Consensus | Amedisys Inc Quote

VGM Scores

At this time, Amedisys' stock has a great Growth Score of A, though it is lagging a lot on the momentum front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% 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.

Our style scores indicate that the stock is more suitable for growth investors than value investors.

Outlook

The stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.


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