Avondale Partners analyst Paula Torch says investors should expect generally good second-quarter numbers from hospital operators in the coming weeks. The recent positive preview from industry leader HCA Holdings was a good tell and should generally translate to other operators. Torch expects LifePoint report earnings per share of $1.01, two cents above analysts’ consensus, on the back of good patient volumes, better cost controls and the upgrading of acquired hospitals. But she’s not as bullish on the prospects of Community Health Systems, which she expects will earn 88 cents per share, a penny less than consensus. But revenues should be strong, she says, helped by easier comparisons to last year’s Q2 and helping to offset spending on doctor recruitment at former HMA hospitals.
Avondale Partners analyst Paula Torch said she expects AmSurg to report second quarter earnings in-line with expectations with potential for upside. Torch also said adjusted earnings per share could exceed analysts' expectation of 85 cents, which is above the ambulatory surgery center's guidance range of 81 cents to 84 cents.
AmSurg has completed six acquisitions this year. "While we continue to believe the pipeline is robust, we look for more color on the pace and ability to meet or exceed $200 million in capital spend on M&A in 2015," Torch said in a report.
Shares of AmSurg (Ticker: AMSG) were down 1 percent to $68.27. Year to date, they're up almost 25 percent.
Hospital stocks are seeing a lot of action after the Supreme Court ruled Thursday to uphold subsidies for consumers buying health insurance in states using the federal marketplace.
Avondale Partners analyst Paula Torch reiterated her 'market outperform' rating for HCA Holdings and raised the firm's price target to $103 from $90, saying the Supreme Court ruling "clears the runway for the multiple to expand."
Mizuho analyst Sheryl Skolnick has upgraded the stocks of Community Health Systems from 'neutral' to 'buy' and raised her $52 price target all the way to $83.90. On the flip side, CHS was downgraded by Raymond James John Ransom, who dropped the firm's 'outperform' rating to 'market perform.'
Also happening today:
• Leerink analyst Ana Gupta raised her price target for HCA from $95 to $100. She also raised her target for CHS to $70 from $60 and LifePoint Health from $75 to $85.
• Analysts at Oppenheimer raised their price target on HCA to $82 from $60 and CHS to $102 from $87.
• Jefferies analyst Brian Tanquilut raised his price target for HCA to $108 from $95 and CHS to $79 from $75.
Two Avondale Partners managing directors and a senior analyst have left the locally based company for global firm Canaccord Genuity, which also has recruited a former Morgan Joseph vice chairman to set up a first Nashville office.
Making the move to Canaccord are:
• Roger Briggs Jr., who will lead Canaccord's sponsor coverage business nationwide and who was a partner at Trilantic Capital Partners from 2011 to 2013. Before that, Briggs (pictured) led Morgan Joseph's investment banking team for eight years.
• investment banker Dudley Baker, who had been with Avondale since late 2010, when he made the move from Morgan Joseph.
• health care technology and services analyst Richard Close and his right-hand man Brian Hoffman, who had been at Avondale since the springs of 2011 and 2012, respectively. Among the companies they cover is downtown-based HealthStream.
Getahn Ward with The Tennessean writes that the team is hunting for office space in Midtown or The Gulch.
Canaccord, whose shares are listed in Toronto (Ticker: CF) and in London, has a market cap of about $670 million and operations in 10 countries on four continents. The firm earlier this month recruited a team of real estate investment trust analysts in New York and San Francisco.
The move by Baker, Close and Hoffman is a blow for Avondale, whose CEO Pat Shepherd last fall told the Post he was seeking to grow his investment banking team and who early this year added former Stephens managing director Stephen Scott. Avondale's investment banking group, which is led by Jonathan Morphett, now has nine members.
Avondale Partners analyst Paula Torch raised per price target for AAC Holdings to $45 from $41 and maintained the firm's 'market outperform' rating.
Torch said in a report issued Thursday that the company had strong growth and long-term earnings potential, saying the Brentwood company could reach $100 million in adjusted EBITDA by 2017.
"We believe the company is very well-positioned to continue its strong growth trajectory with enough fuel near-term to add more assets to its portfolio," Torch said in the report.
Shares of AAC (Ticker: AAC) were up 6 percent Thursday afternoon to $37.95. Year to date, they're up 22 percent.
Analysts at Leerink Partners and Avondale Partners have raised their price targets for HCA Holdings after the company's first-quarter earnings were in-line and the company announced plans to increase capital spending by $500 million.
Paula Torch at Avondale Partners increased her price target for the company to $90, and maintained her 'market outperform' rating.
"HCA's continued execution, expansion of service lines and access to the patient is driving strong revenue and margin expansion," Torch wrote in a report.
Ana Gupte at Leerink Partners raised her price target for HCA from $80 to $85 and also reiterated an 'outperform' rating.
"Our positive thesis is based on recently observed better than expected core growth and stronger ACA tailwinds of reduced bad debt and increased utilization from access expansion to the uninsured with Medicaid expansion and public exchanges," Gupte said in a report.
Shares of HCA (Ticker: HCA) rose 2.8 percent Thursday to $76.59. Year to date, they're up 4 percent.
Avondale Partners analyst Paula Torch has raised her price target for Nashville-based AmSurg to $74 from $69.
The firm has maintained its 'market outperform' for the company, saying its raised guidance for revenues in a range of $2.46 billion to $2.48 billion could be conservative.
"[AmSurg] is executing on its JV partnerships, cross-selling initiatives, and we believe the pipeline for acquisitions remains plentiful," Torch said in a report issued Wednesday.
Shares of AmSurg (Ticker: AMSG) were up to $64.75 Thursday morning. Year to date, they've climbed 18 percent.
Analyst Paula Torch at Avondale Partners has raised her price target for shares of Acadia Healthcare to $80 from $77 following the company's Q1 earnings report. The company, she says, can reach a $2 billion revenue run rate by the end of next year by continuing to combine organic growth with acquisitions — for which it still has $180 million on its revolving credit line.
On the operations side, Torch said pricing pressures related to shorter lengths of stay in certain parts of the country should abate soon while there are opportunities to fill more than 600 beds at newly acquired CRC. That acquisition is on track to generate $7.5 million in savings this year.
"ACHC's stock appears priced to perfection," Torch wrote in a note on Friday. "However, we see plentiful opportunities for continued organic growth driven by its core psych business, the UK and CRC."
Shares of Acadia (Ticker: ACHC) closed Friday at $68.71, up slightly on the day. Year to date, they're down 5 percent.
Avondale Partners analyst Brian Hoffman says Healthcare Realty Trust investors should look for the company to sell a few more properties than previously expected this year. Healthcare Realty execs recently issued $250 million in notes to redeem most of another chunk of debt and plans to borrow about $83 million from its revolving credit line to finish that deal. That, Hoffman says, will lead to 2015 dispositions worth about $100 million rather than $75 million. The analyst has reiterated his 'market perform' rating and $28 price target on the stock (Ticker: HR), which closed Tuesday at $26.75.
Down the hall at Avondale, Richard Close has reiterated his 'market outperform' rating and $33.50 price target on shares of HealthStream following the company's strong first-quarter earnings report. Close says he and his associates have "an upward bias to our estimates throughout 2015, although we note management effectively affirmed guidance despite the beat. We look to gain additional details on timing of investment spend throughout the remaining quarters of 2015." HealthStream shares (Ticker: HSTM) popped 9 percent Tuesday to $29.20.
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