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Why Is AMN Healthcare (AMN) Up 5.6% Since Last Earnings Report?

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A month has gone by since the last earnings report for AMN Healthcare Services (AMN - Free Report) . Shares have added about 5.6% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is AMN Healthcare 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.

AMN Healthcare Q2 Earnings Beat Estimates, View Impressive

AMN Healthcare reported second-quarter 2019 adjusted earnings per share (EPS) of 77 cents, which outpaced the Zacks Consensus Estimate of 70 cents. However, the bottom line declined 7.2% year over year.

The company reported revenues worth $535.2 million, which surpassed the Zacks Consensus Estimate of $527.1 million. However, on a year-over-year basis, revenues dropped 4.1%.

Segment Details

Nurse and Allied Solutions

In the second quarter of 2019, the segment’s revenues totaled $331.6 million, down 0.3% year over year.

Locum Tenens Solutions
The segment’s revenues amounted to $82.1 million, down 23.5% from the prior-year quarter.

Other Workforce Solutions

In the quarter under review, the segment’s revenues came in at $121.5 million, up 2.9% year over year.

Margin

In the second quarter, gross profit totaled $179.5 million, down 0.8% year over year. As a percentage of revenues, gross margin was 33.5% which expanded 110 basis points (bps).

Total operating expenses in the quarter were $131.7 million, up 16.9% year over year. Operating income in the quarter was $134.4 million, up 6.5%. As a percentage of revenues, operating margin was 8.4%, down 140 bps.

Guidance

For the third quarter of 2019, AMN Healthcare expects revenues within $560-$566 million.

Gross margin is expected at 33% while operating margin is estimated at 7.7%.

Adjusted EBITDA is projected at 12%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review.

VGM Scores

At this time, AMN Healthcare has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, AMN Healthcare has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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