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AMN Healthcare (AMN) Q1 Earnings and Revenues Top Estimates

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AMN Healthcare Services Inc. (AMN - Free Report) reported first-quarter 2019 adjusted earnings per share (EPS) of 75 cents, which beat the Zacks Consensus Estimate by 8.7%. However, the bottom line declined 7.4% year over year.
 
The company reported revenues worth $532.4 million, which surpassed the Zacks Consensus Estimate by 1.5%. On a year-over-year basis, revenues rose 1.9%.
 
Segment Details
 
Nurse and Allied Solutions
 
In the first quarter of 2019, the segment’s revenues totaled $337 million, down 0.3% year over year.
 
Locum Tenens Solutions
 
The segment’s revenues amounted to $80.5 million, down 21.9% from the prior-year quarter.
 
Other Workforce Solutions
 
In the quarter under review, the segment’s revenues came in at $114.9 million, up 41.5% year over year.

AMN Healthcare Services Inc Price, Consensus and EPS Surprise

 

AMN Healthcare Services Inc Price, Consensus and EPS Surprise | AMN Healthcare Services Inc Quote

Margin

In the first quarter, gross profit totaled $176.8 million, up 5.3% year over year. As a percentage of revenues, gross margin was 33.2% which expanded 110 bps.
 
Total operating expenses in the quarter were $131.7 million, up 16.9% year over year. As a percentage of revenues, operating margin was 8.5%, down 210 bps.
 
Guidance
 
AMN Healthcare has provided guidance for the second quarter of 2019.
 
Notably, second-quarter revenues are anticipated within $518-$524 million. The mid-point of $521 million lies within the Zacks Consensus Estimate of $528.6 million.
 
The company expects adjusted EBITDA margin of 12% for the second quarter.
 
Operating margin is anticipated to be 7.8%.
 
Our Take
 
AMN Healthcare exited the first quarter on a solid note. The company gained from its core Other Workforce Solutions unit which put up a strong show in the quarter. Management is upbeat about the latest Advanced Medical buyout, which is expected to expand the company’s travel as well as school therapy and travel nurse staffing capabilities. Expansion in gross margin is also encouraging. It is also important to note here that the first-quarter financial results exceeded the company’s expectations.
 
However, lackluster performance by the company’s Nurse and Allied as well as Locum Tenens Solutions is worrisome. In fact, management anticipates a dismal second quarter by its core Nurse and Allied segment owing to labor disruption event in the respective quarter itself. In the second quarter, the company anticipates revenues to decline on a year-over-year basis primarily due to the labor disruption event in the Nurse and Allied segment as well as lower contribution from Locum Tenens unit. Contraction in operating margin adds to woes. 
 
Zacks Rank
 
Currently, AMN Healthcare carries a Zacks Rank #4 (Sell). 
 
Earnings of MedTech Majors at a Glance
 
Some better-ranked stocks which reported solid results this earning season are Stryker Corporation (SYK - Free Report) , Abbott Laboratories (ABT - Free Report) and CONMED Corporation (CNMD - Free Report) , each carrying a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stryker delivered first-quarter 2019 adjusted earnings per share of $1.88, beating the Zacks Consensus Estimate by 2.2%. Revenues of $3.52 billion were in line with the Zacks Consensus Estimate.
 
Abbott reported first-quarter 2019 adjusted earnings of 63 cents per share, beating the Zacks Consensus Estimate by 3.3%. First-quarter worldwide sales came in at $7.54 billion, above the Zacks Consensus Estimate of $7.47 billion.
 
CONMED posted first-quarter 2019 adjusted earnings per share of 57 cents, which beat the Zacks Consensus Estimate of 54 cents. Revenues were $218.4 million, surpassing the Zacks Consensus Estimate of $213 million.

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