Home Health Values Surge in January
Home health care stock values were booming at the start of the year, according to the latest data from Stoneridge Partners’ Home Health Index. The Index, which tracks the market values of three of the largest publicly-traded home health care companies – Almost Family (Nasdaq: AFAM), Amedisys (Nasdaq: AMED) and LHC Group (Nasdaq: LHCG) – rose sharply during the first month of 2017, continuing a recent trending uptick.
All three companies saw their market values increase, with the overall Index jumping 7.72% in January. The uptick is in line with greater indexes across the economy, though the Home Health Index outpaced the S&P 500, which rose 1.85% in January.
The month was marked by a rally across other indices as well, including the Dow Jones industrial average, which broke through a symbolic 20,000-point threshold. Stocks rose as the new President, Donald Trump, took office Jan. 20.
“A strong economic rally was underway at the beginning of the year, with home health seeing steady gains,” said Rich Tinsley, president of Stoneridge Partners. “With a new administration in place and sweeping health care changes expected to come in the near future, investors were bullish on home health in January.”
Almost Family, based in Louisville, saw its stock price rise 7.6% during January. By comparison, the stock rose 5.42% in December, coming off record revenues for the company.
Amedisys Inc. also saw large gains, with its share price rising 6.66% from December. The Baton Rouge-based company has been aggressively scaling up its strategy and has taken on a number of new partnerships, as well as recent shakeups at the executive level. In December, the stock rose 2.87%.
Lafayette, Louisiana-based LHC Group saw the biggest gains in the month, with its stock rising 8.84%. The company’s stock rapidly increased at the end of 2016, surging 19.34% in November and 6.58% in December.
In contrast, Addus Homecare (Nasdaq: ADUS), which is not tracked by the index because so little of its revenue comes from Medicare, saw its share price slump 3.24% in January. However, the company’s stock was up a whopping 55.49% at the end of 2016.
Quote Of The Month
“With M&A and a strong new business segment outlook, executives are clearly keeping all avenues to growth on the table,” said Al Aria, Senior Managing Director, Capital One HealthCare.
Read the Full Article Here: Healthcare Executives Expect M&A, New Segments to Drive 2017 Growth
See It to Believe It!
The Stoneridge Partners Home Health Index (HH Index) is updated monthly and measures the performance of these three publicly traded home health companies, all listed on the NASDAQ:
- Almost Family (AFAM)
- LHC Group (LHCG)
- Amedisys (AMED)
Please note the graphs representing (1) HH Index to the percentage change in the S&P 500 Index for over 14 years, (2) 12 month trailing chart of the HH Index, and (3) HH Index to the price of Addus stock (non-Medicare) can be found in the most recent issue of the Home Health Index.
Here are the results of the stock prices for the past two years:
|Company||1/31/17||1 mos change||YTD change||1/31/16||1/31/15|
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)||1/31/2017||1/31/2016|
|HH Index Total||3217||2415|
Enterprise Value (EV), aka Selling Price, as a Percent of Revenue.
|HH Index Average*||110%||94%|
Multiples of EV/EBITDA.
Think of this as selling price as a multiple of EBITDA.
|HH Index Average*||15.23||11.85|
The above calculations are based on selling price being defined as Enterprise Value (EV), with data provided by Capital IQ. EV has been calculated based on stock prices September 1. 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 that may differ from that used by a company its reporting.
SOLD BY STONERIDGE!
- Excel Companion Care, based in Warminster, Pennsylvania, was acquired by Help at Home. Partner, Brian Bruenderman, provided sell-side advisory services for this transaction.
- Health Sense Home Care, Inc. based in Austin, Texas was acquired by Jordan Health Services. Partner, Joe Lynch, provided sell-side advisory services for this transaction.
Recent Transactions From Around the Country:
- Care Advantage, Inc., one of Virginia’s largest privately held home health care providers, has been acquired by BelHealth Investment Partners, LLC, a New York-based healthcare-focused private equity firm.
- Jet Health, Inc., expands their service area into two new markets with the acquisition of Home Health Investments, LLC, a Colorado-based home health services provider.
- Jordan Health Services, a home health and hospice provider has acquired Dallas-based, CareCycle Solutions, LLC.
- Texas Home Health, an AccentCare, Inc. company, acquired Padre Home Health in Corpus Christi, Texas and Royalty Personal Assistance Service in Texas City, Texas.
- Associated Home Care, a subsidiary of Amedisys, the Louisiana-based home nursing and hospice provider, completes the acquisition of the Massachusetts-based home health company, Home Staff, LLC. This acquisition makes Amedisys the largest personal care provider in Massachusetts.
Exclusively Listed for Sale by Stoneridge Partners:
- Connecticut – Private pay and Medicaid agency with a nice growth trend. $4 million run rate annual revenue. Good staff in place. Stoneridge File SBB-6020
- Florida – Located in the huge east coast Florida District 9, this is a $6 million Medicare agency with approx. 98% of revenue coming from traditional Medicare. Very well run with excellent financial records and solid bottom line. Stoneridge File SDC-7429
- Florida – $4.5 million Medicare certified home health agency in Districts 6 and 7. Solid bottom line. Accredited and outstanding clinicals. Stoneridge File SBA-5272
- Florida – $4 million in pure private pay. 15% bottom line. Accredited on the central east coast. Stoneridge File SBA-3250
- Florida – Located in the Orlando area this is a $4 million diversified home health agency. Payor sources include Medicare, Medicaid and private pay, 35% of which is traditional Medicare. Top management will assure smooth transition. Well run with excellent financial records and solid bottom line. Stoneridge File SDC-3739
- Florida – Home care company in affluent area on west coast of Florida. $2.7 million run rate. Non-Medicare with 86% pure private pay. Consistent moderate growth. Caregivers are W-2 employees. Stoneridge File SBA-1253
- Florida – $2.5 million Medicare agency in Port St. Lucie. Great reputation and clinicals. Stoneridge File SCM-6191
- Florida – $2.4 million Medicare certified home health agency in District 3. Outstanding clinical with highest star rating. Longtime Home Care Elite top agency. Excellent growth opportunities. Stoneridge File SBA-4836
- Florida – $1.4 million growing private duty business in District 7. Well-run clinically and poised for growth FY 2017. Stoneridge File SCM-5220
- Illinois – $5.5 million accredited Medicare agency located in northeastern Illinois. Strong bottom line. 4 1/2 star rating by CMS. Stoneridge File SBA-2734
- Illinois – $3.4 million Medicare deficiency free home health agency in Northern Illinois. This agency has built its success by concentrating on a very profitable and loyal market niche, and has an outstanding reputation with both their patients and community. Stoneridge File SCM-3291
- Illinois – $1.5 million Medicare certified home health agency. Clean survey and deficiency free. Quality clinical operation with staff in place. Stoneridge File SBA-7425
- Indiana – Opportunity to establish a Medicare hospice, accredited and ready to grow with new owner. Stoneridge File SBB-7911
- Louisiana – $3 million Medicare certified and accredited home health agency. Strong referral base and outstanding clinicals. Stoneridge File SBA-7299
- Michigan – Profitable $1.8 million private duty business located in Northern Michigan. Family owned for over 25 years with great ties to local community, agencies and referral base. Stoneridge File SCM-4900
- Michigan – $1.8 million Medicare agency located in Western Michigan. Stoneridge File SBB-5471
- Midwest – Private duty business with over $6 million in pure private pay revenue. No Medicare or Medicaid. Many years established, excellent financial records with solid bottom line. Stoneridge File SDC-3469
- Missouri – $2.8 million Medicaid agency in greater St. Louis area. Nice bottom line. Excellent add-on acquisition opportunity. Stoneridge File SBB-9001
- Mountain West – $2 million private pay agency located in the Mountain West. Impressive growth patterns and very profitable. Stoneridge File SJL-2549
- Multi-State – $30 million behavioral health agency. Well-established, platform opportunity. Stoneridge File SBB-8101
- Nevada – $1.2 million Medicare home health agency located in Las Vegas, Nevada. Clean, profitable and family owned since 2004. HomeCare Elite recipient in 2010, 2012, 2013, 2016. Stoneridge File SCM-6180
- Oklahoma – Medicare certified hospice for sale in Central Oklahoma. $2.1 million run rate. Accredited. Multiple locations. Stoneridge File SBA-3881
- Pennsylvania – $2.8 million Medicare certified home health agency with small hospice operations in Eastern Pennsylvania. 72% traditional Medicare for home health. Great tuck-in opportunity for strategic buyer. Requires corporate support functions. Stoneridge File SBA-4227
- Southwest – $60 million agency providing home health, personal care and hospice services in the Southwest. Approximately 50% of revenue derived from hospice operations. Long history with great reputation for quality care. Consistent, strong growth. Multiple locations with strong presence in the markets served. Stoneridge File SBA-5050
- Southwest – $30 million hospice company with accompanying home health located in the southwest United States. Stoneridge File SJL-9650
- Texas – $5.5 million well-established PHC and Medicare provider located in the Dallas/Ft. Worth Metroplex. Showing positive growth and impressive profitability. Stoneridge File SJL-4918
- Texas – $3.5 million home health agency in Houston (metro). Diversified agency – 70% Medicare, 30% private pay. Inherent capacity for growth. Stoneridge File SJL-2000
- Texas – $3.2 million hospice in McAllen, Texas. CHAP accredited with a solid reputation. Stoneridge File SJL-1112
- Texas – Profitable $3 million Medicare & Medicaid home care company in East Texas. Well-run with an excellent reputation, full staff in place and a 4.5 star rating. Stoneridge File SJL-9472
- Texas – Growing $2.6 million west Texas Medicare certified home health agency. Accredited with a wide variety of referral sources. Stoneridge File SJL-2892
- Texas – $2.8 million private pay home care agency in a major metropolitan market. Pure private pay, no Medicaid, no Medicare. Approximately 10$ EBITDA. Stoneridge File SDC-8557
- Texas – $2.6 million established home health agency in Dallas with both Medicare and Medicaid lines of business. Stoneridge File SJL-8335
- Texas – $2 million Medicare accredited home health care company located in Southeast Texas near Huntsvile. Strong financials, clinically clean with nice opportunity for growth. Stoneridge File SCM-9753
- Texas – $1.3 million all private pay agency located in Ft. Worth. Excellent reputation, excellent reviews and extremely profitable. Stoneridge File SJL-5115
- Texas – $1.3 million profitable Medicare and Medicaid agency located in a growing market just north of Dallas. Clean clinically with excellent financials. Stoneridge File SJL-1492
- Texas – $1.2 million established and profitable home health agency with two offices and service area from Conroe to Galveston. Stoneridge File SJL-6249
- Texas – Established and profitable $1.2 million private pay agency located in the Dallas/Fort Worth metroplex. Clean surveys with all appropriate staff in place. Stoneridge File SJL-1373
- Virginia – $13 million Medicare/Medicaid home health agency located in Western Virginia. Long community reputation. Stable & consistent growth over the last 10 years. Platform suitable for expansion. Stoneridge File SBB-3980
- Wisconsin – $1.5 million Medicare certified home health agency. Licensed in Wisconsin. 4 star rating. Staff in place. Motivated seller. Stoneridge File SBA-5776
- Pacific Northwest – $2+ million all private pay agency located in the pacific northwest. Established and profitable with employees, software systems and marketing in place. Stoneridge File SJL-3008 ON CONTRACT
- Texas – $7 million Houston-based Medicare home health agency. Accredited, expertly run and growing. Stoneridge File SJL-1500 ON CONTRACT
- Texas – $4.1 million Dallas based home care company. Well managed and showing strong growth trends for 2016. Stoneridge File SJL-6002 ON CONTRACT
- Texas – $1.1 million solid and clean Medicare home health agency located in the Fort Worth area. Stoneridge File SJL-7530 ON CONTRACT
To see more home care agencies and hospices exclusively listed for sale by Stoneridge Partners click here.
Do you know of any acquisitions that have taken place? We would be interested in your comments. At the top of this column is a “Contact Tab” with a section for comments. These can be sent anonymously. The return email address can be left blank. We are interested in what you have to say, or acquisitions that you know about.
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From Rich Tinsley, Publisher of “Home Health Index”. Rich can be reached at email@example.com or (239) 561-0826 and toll-free 800-218-3944