Amedisys, LHC Group Stocks Trend Downward in August

Amedisys, LHC Group Stocks Trend Downward in August

Home health stocks took a hit in August according to the Stoneridge Partners Home Health Index (HHI). Amid volatility in the broader market, stock values tracked by the Stoneridge HHI were down nearly 4.4% compared to the previous month. The S&P 500 was down just over 1.8%.

The Stoneridge Partners HHI monitors the stock values of Baton Rouge, Louisiana-based Amedisys, Inc. and Lafayette, Louisiana-based LHC Group, Inc., two of the country’s largest independent and publicly-traded home health companies. The mergers and acquisitions advisory firm also tracks but does not include stock values for Addus HomeCare Corporation in its final HHI calculations.

Amedisys (Nasdaq: AMED) stock values saw the biggest dip in August, down 4.7% compared to July. Still, the home health provider remains up nearly 3% year-over-year. LHC Group (Nasdaq: LHCG) stock was down nearly 4.1% compared to the previous month — but it still outpaced its performance in August of last year by nearly 19.8%.

The lone bright spot in August was Addus (Nasdaq: ADUS), stealing the show with an 8.6% increase in stock values month-over-month, and nearly 35.6% year-over-year.

“Companies released their second quarter results at the beginning of August, so that could have temporarily affected the continued growth we’ve seen from Amedisys and LHC Group,” Stoneridge Partners President Rich Tinsley said. “Plus, as Medicare-reimbursed providers, they are facing a host of regulatory changes in the months to come. That uncertainty might have been a factor. Addus, on the other hand, does mostly Medicaid-reimbursed home care — plus, it has Medicare Advantage changes working in its favor. So they may have been better positioned in August to continue leading the recent charge for home health stocks.”

Year over year, home health stocks were up about 10.4% while the S&P 500 was up less than 1.5%, according to the Stoneridge Partners HHI.

Quote Of The Month

“We shouldn’t be treating mental and physical health as two completely separate things. The way we tend to respond to psychological health issues is quite different from our responses to physical health issues. As a society, we don’t train proactively about mental health issues. We don’t teach early prevention strategies. There seems a lot of discomfort and stigma around people who disclose they have psychological health issues.” – Shelley MacDermid Wadsworth, Professor of human development and family studies and director of the Military Family Research Institute of Purdue

Read the Full Article Here:  Supporting the mental health of military personnel, families and veterans in times of war

 

See It To Believe It!

The Stoneridge Partners Home Health Index (HH Index) is updated monthly and measures the performance of these two publicly traded home health companies, all listed on the NASDAQ:

  • LHC Group (LHCG)
  • Amedisys (AMED)

This graph compares the percentage of the Home Health Index to the percentage change in the S&P 500 Index going back to 2002.
[visualizer id=”8359″]
This is a 12 month trailing chart of the HH Index compared to the actual prices of the individual companies that make up the chart.
[visualizer id=”8361″]

This graph displays HH Index performance since 2002.

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This graph compares the HH Index to the price of Addus stock (non-Medicare).
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(Home Health Index September 2019 | Stoneridge Partners)

 

Here are the results of the stock prices for the past two years:

Company 8/31/19 1 mos change YTD change 8/31/18 8/31/17
Amedisys 128.71 -4.70% +10.16% 125.01 52.24
LHC Group 118.5 -4.06% +26.82% 98.93 65.25
HH Index* 123.61 -4.39% +17.56% 111.97 55.40
S&P 2926.46 -1.81% +17.27% 2884 2471.65
Addus 87.98 +8.55% +29.27% 64.90 34.05

Although we track the performance of Addus, they are not included in our HH Index because very little of their revenue comes from Medicare.

 

Enterprise Value (EV)

EV (in M) 8/31/19 8/31/18 8/31/17
Amedisys 4490 3980 1719
LHC Group 4130 3430 1299
HH Index Total 8620 7410 3845
Addus 1150 804 424


Enterprise Value (EV), aka Selling Price, as Percent of Revenue

Company 8/31/19 8/31/18 8/31/17
Amedisys 248% 252% 116%
LHC Group 203% 253% 134%
HH Index Average* 226% 253% 122%
Addus 203% 176% 103%


Multiples of EV/EBITDA

Think of this as selling price as a multiple of EBITDA.

Company 8/31/19 8/31/18 8/31/17
Amedisys 24.92 26.41 20.3
LHC Group 20.33 33.19 14.06
HH Index Average* 22.63 29.80 18.28
Addus 27.74 22.30 12.99

The above calculations are based on selling price being defined as Enterprise Value (EV), with data provided by Capital IQ. Enterprise value is defined as market cap plus debt, minority interest and preferred shares, minus total cash and cash equivalents. EBITDA is calculated using methodology which may differ from that used by a company for its reporting. (Home Health Index September 2019 | Stoneridge Partners)

Recent Transactions From Around The Country

  • Unilever acquired Bolivian’s Personal and Home Care Business Asterix
  • Addus HomeCare Corp. acquired Hospice Partners of America LLC, which has 21 locations in Texas, Idaho, Kansas, Missouri, Oregon and Virginia
  • St. Paul, Minnesota based St. Croix Hospice acquired Hometown Hospice & Homecare
  • Care Advantage Inc., a Chesterfield County-based home health provider acquired Allegiance Home Care

CLOSED by Stoneridge

  • Stoneridge Partners, Partner Joe Lynch, assisted with the partnership of CAP Funds and Bayou Home Care in August 2019
  • Stoneridge Partners represented a New Mexico based  agency that closed August 2019

Exclusively Listed For Sale By Stoneridge Partners

Do you know of any acquisitions that have taken place?  We are interested in your comments.  At the top of this column is a “Contact Tab” with a section for comments.  These can be sent anonymously and the return email address can be left blank.

Conference News

Brian Bruenderman, Partner and Executive Vice President of Stoneridge Partners is speaking at the National Association for Home Care & Hospice Conference in Seattle, Washington on Monday, October 14, 2019 at 4:30 pm in room 6E.

Another Cartoon Favorite 

   

 

More

Home Health Index September 2019 | Stoneridge Partners

From Rich Tinsley, Publisher of “Home Health Index”. Rich can be reached at [email protected] or (239) 561-0826 and toll-free 800-218-3944

Previous editions of this monthly newsletter can be searched for at the bottom of the home page of the Home Health Index. Links to Google Finance: Amedisys | LHC Group

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