Home Health Valuations Steady Despite Crushing Labor Costs: An Interview With Al Veach & Jason Harrison of Agenda Health

Home Health Valuations Steady Despite Crushing Labor Costs: An Interview With Al Veach & Jason Harrison of Agenda Health

Deal activity in the Home Health & Hospice (HH&H) space has slowed dramatically over the course of the year. The break-neck pace set during the first quarter of 2022, when 32 HH&H transactions were announced, didn’t last. During the fourth quarter, HH&H deals are barely trickling in. There have been just 15 deals announced during this quarter as of December 5th, a 62% decrease from Q4’s total in the previous year, when there were 39 deals announced. We will see where we end up on January 1, but a decline seems likely. Despite the slow market, M&A advisors are optimistic. We spoke with Al Veach and Jason Harrison of Agenda Health about their outlook on the home health... Read More »
Earnings Takeaways: How Companies Are Evolving to Meet Labor and Inflation Headwinds

Earnings Takeaways: How Companies Are Evolving to Meet Labor and Inflation Headwinds

It’s been a turbulent earnings season. Although some companies are thriving, inflation, reimbursement changes, labor shortages and other headwinds have hit every organization across the board. Some companies, like American Well Corp (Amwell) (NYSE: AMWL), U.S. Physical Therapy, Inc (USPT) (NYSE: USPH) and Addus HomeCare Corp. (NASDAQ: ADUS), were able to post strong financial and performance results despite the headwinds, while others, like Providence Health & Services (NASDAQ: PRSC), Universal Health Services (NYSE: UHS) and Laboratory Corporation of America Holdings (Labcorp) (NYSE: LH), reported significant losses. We don’t expect these headwinds to disappear anytime soon as... Read More »
High Hopes for the Rehabilitation Market: Strong Tailwinds Push Deal Activity

High Hopes for the Rehabilitation Market: Strong Tailwinds Push Deal Activity

Whenever we speak with dealmakers in the healthcare M&A market, they frequently discuss how the market is fragmented. Although there is no shortage of major players, especially as retail and tech giants push deeper into healthcare, there’s still a high volume of smaller, independently owned agencies and providers. The U.S. outpatient rehabilitation market has more than 37,000 independent clinics, and no company owns more than 10% market share. Some significant players include Select Medical (1,933 clinics), ATI Physical Therapy (900 clinics) and U.S. Physical Therapy, Inc. (629 clinics). Additionally, rehabilitation services are split across many sources: hospitals, therapy clinics,... Read More »
Pediatrix Reports Drop in Q3 Revenue

Pediatrix Reports Drop in Q3 Revenue

Pediatrix Medical Group, Inc. reported a revenue decline during the third quarter.  Earnings, adjusted for non-recurring gains, reached $0.40 per share, missing the Zacks Consensus Estimate of $0.53 per share. The results were attributed to a decline in neonatology services and, more significantly, switching revenue cycle management companies that unfavorably impacted revenue and adjusted EBITDA by $11 million and $9 million, respectively.  The Sunrise, Florida-based company reported: For Q3:22, adjusted EPS from continuing operations of $0.40 cents, compared to $0.46 in Q3:21.A 0.6% decrease in net revenue from $492.95 million in Q3:21 to $489.92 million in Q3:22. A 20.5%... Read More »
Healthcare Leaders Address Acquisition Strategies During Third-Quarter Earnings Calls as Strong Results Reported

Healthcare Leaders Address Acquisition Strategies During Third-Quarter Earnings Calls as Strong Results Reported

Healthcare firms reported solid quarterly earnings during the week of October 31 with several executives mentioning the outlook for acquisitions. CVS Health Corporation on November 2 reported third-quarter results that featured double-digit percentage increases for total revenue in the quarter and the year. Revenue increased to $81.2 billion in the quarter, up 10% compared to the prior year. Revenue in the year-to-date period jumped to $238.6 billion, up 10.7% compared to the previous year. The Woonsocket, Rhode Island-based company raised its 2022 full-year cash flow from operations guidance range to $13.5 billion to $14.5 billion from $12.5 billion to $13.5 billion. On September 2, the... Read More »
U.S. Physical Therapy’s Q3 2022 Earnings Highlights

U.S. Physical Therapy’s Q3 2022 Earnings Highlights

U.S. Physical Therapy, Inc (USPT) announced its financial results for the third quarter ended September 30, 2022. Earnings, adjusted for non-recurring gains, came to $0.58 per share, beating the Zacks Consensus Estimate of $0.55 per share. Despite the impact labor and inflation-related headwinds had on some financial metrics (net income and adjusted EBITDA), USPT still managed to report strong revenues and improved performance indicators, such as patient visits. USPT also remained active throughout the quarter with several acquisitions announced and completed. The Houston, Texas-based company reported: 10.9% increase in total revenue from $125.9 million in Q3:21 to $139.6 million in... Read More »