LHC Group, Inc. (LHCG - Free Report) recently announced an expansion of its existing joint venture (JV) with Ochsner Health System — Southeast Louisiana HomeCare. Under the terms of the partnership, five Egan Home Health and Hospice provider locations across South Louisiana will be purchased.
The financial terms of the deal have been kept under wrap.
For investors’ notice, Ochsner Health System is Louisiana’s largest non-profit, academic, healthcare system.
How Will LHC Group Gain?
LHC Group has long been focusing on acquisitions and JVs for inorganic expansion. In fact, for 2019, the company’s target for M&A volume ranges between $100 million and $150 million.
LHC Group formed the JV with Ochsner Health in 2009 to improve quality of services. Since then, the JV has successfully reduced hospital readmission rates.
The latest development is expected to boost LHC Group’s in-home care services. Notably, the company’s wide array of home-care services has been instrumental in boosting its top line. These include home health services, nurses, home health aides and therapists, who work closely with patients and their families to design and implement individualized treatment plans.
In December, LHC Group has seen some major developments.
The company has announced the expansion of its partnership with Medalogix as well. The aim is to implement Medalogix Bridge in multiple markets. Per management, the implementation will be completed by the first quarter of 2020. Per management, the aim of the expansion is to improve value-based care and reduce treatment costs for patients.
Moreover, the company announced the expansion of its existing JV partnership with LifePoint Health. The agreement will be finalized in January 2020. The JV has grown to include 49 home health and hospice locations across 10 states, since its formation in 2017.
In a year’s time, the Zacks Rank #2 (Buy) company has rallied 46.2% against the industry’s 3.4% decline.
Other Key Picks
Other top-ranked stocks from the broader medical space are CONMED Corporation (CNMD - Free Report) , HealthEquity (HQY - Free Report) and West Pharmaceutical Services (WST - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Conmed has a long-term earnings growth rate of 17%.
HealthEquity has a long-term earnings growth rate of 25%.
West Pharmaceuticals has a long-term earnings growth rate of 14%.
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