Home Health Index | 2019 FEBRUARY UPDATE

Amedysis, LHC Group Stock See Double-Digit January Gains 

Amedisys, LHC Group Stock See Double-Digit January Gains

Healthcare mergers and acquisitions firm Stoneridge Partners has released its latest Home Health Index (HHI), and it shows good news for shareholders. Home health stocks performed strongly in January, rising 11.87% – growth that slightly outperformed the broader market. The S&P 500 climbed  8.51% in January.

Updated monthly, the Stoneridge HHI tracks the market values of Frisco, Texas-based Addus, as well as Amedisys Inc. (Nasdaq: AMED) and LHC Group Inc. (LHCG).

“Home health stocks were down in December, but they’ve rebounded in the early part of 2019 thanks to great performance by both Amedisys and LHC Group,” said Stoneridge Partners President Rich Tinsley. “Addus is the only exception at this time, which is still down. But we’ll  get more insight into how these companies are really doing when they report quarterly earnings this month.”

Stock prices for Baton Rouge, Louisiana-based Amedisys and Lafayette, Louisiana-based LHC Group both recorded double-digit gains. Amedisys saw its stock rise by 12.22% in January compared to December. The company will look to carry that momentum throughout February, further buoyed by the closing of its $340 million Compassionate Care Hospice acquisition on Feb. 4. Stock values for LHC Group, meanwhile, jumped 11.42% in January compared to the previous month. In comparison, Addus stock dipped by double digits, falling 10.48%. Stoneridge’s final HHI calculation does not include Addus, however, due to the company’s revenue mix.

The HHI was up 102.69% in January over the trailing 12 months, thanks largely to Amedisys being up 147.96% on a 12-month basis. LHC Group was up 63.69% in January over the trailing 12 months, while Addus was up 66.48%. From January 2018 to January 2019, the S&P 500 was down 4.15%, reflective of the home health industry’s heightened ability to withstand macro-level headwinds compared to other sectors.

Quote Of The Month 

“As lifespans increase, and as the cost of health care reaches new heights, many adults are shouldering the responsibility of ongoing support for their family members,” Angie O’Leary, head of wealth planning at RBC Wealth Management – U.S.

Read the Full Article Here: Why Respite Care Remains Important Part of Home Care Agencies’ Service Mix 

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.


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.

This graph displays HH Index performance since 2002.


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

 

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

Company 1/31/19 1 mos change YTD change 1/31/18 1/31/17
Amedisys 131.12 -12.22% +12.22% 52.88 45.47
LHC Group 104.11 -11.42% +34.45% 63.60 49.74
HH Index* 117.62 -11.87% +46.32% 58.03 47.55
S&P 2707.76 -8.51% -7.14% 2825.09 2280.22
Addus 60.93 +10.48% +48.87% 36.60 33.90

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) 1/31/19 1/31/18 1/31/17
Amedisys 4170 1840 1610
LHC Group 3610 1280 985
HH Index Total 7780 4017 3217
Addus 687 410 371


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

Company 1/31/19 1/31/18 1/31/17
Amedisys 257% 125% 116%
LHC Group 227% 127% 112%
HH Index Average* 242% 124% 110%
Addus 141% 99% 97%


Multiples of EV/EBITDA

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

Company 1/31/19 1/31/18 1/31/17
Amedisys 25.39 15.94 20.35
LHC Group 27.09 13.63 11.95
HH Index Average* 26.24 16.88 15.23
Addus 18.35 12.04 14.03

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 to it’s reporting. (Home Health Index February 2019 | Stoneridge Partners)

Recent Transactions From Around The Country

  • Banner Health has assumed operations of TRU Hospice in Northern Colorado
  • Baton Rouge based Amedisys acquired Compassionate Care Hospice
  • HouseWorks, a private-pay in-home care company, has acquired Philadelphia based Caring Friends Home Care
  • California based chronic disease management company Livongo Health has acquired Denver based myStrength

SOLD!!! By Stoneridge

  • Stoneridge Partners represented a Pennsylvania based Home Healthcare agency that closed January 2019
  • Stoneridge Partners represented the buyer of a Texas based Healthcare agency that closed January 2019

Exclusively Listed For Sale By Stoneridge Partners

State
Agency Profile
Status
Reference Number
Arizona$2+ million home care agency in Southern Arizona. Diverse payor sources (Medicaid/Private Pay/ W/C. Diverse referral sources. Great reputation. Available
SBA-6228
ArizonaMedicare/Medicaid certified Home Health Agency. $1.8 million in annual revenue. 90% Medicaid/10% Medicare. Phoenix metropolitan area. Accredited. 5 star rating.Available
SBA-9188
California$6 million revenue. Hyrbid payor mix - 70% in network, 20% out of network, 10% private cash pay. Destination oriented treatment facility. 48 residential beds and 6 detox beds. JCAHO accredited. Beautiful property with more adjacent available for purchase. Tons of amenities.Available
SJD-2579
California$5 million revenue with $1.25 million EBITDA. Full continuum treatment center. 3 residential houses, 2 sober living and 1 outpatient. JCAHO certified. Private pay and out of network. Available
SJD-4380
California$2+ million revenue. $550,000 net profit. 28 bed, 4 facilities. Full continuum of care treatment center in California. Growing quickly with a large wait list. 10 bed detox license. Gorgeous real estate for sale or lease. Great reputation and referrals. Available
SJD-8481
CaliforniaGrowing $1.9 million revenue. Private pay. Independently owned. Full staff in place. Available
SJL-4483
California32 bed detox and residential treatment center. Great location and setup. In network. Large growth with a waiting list. Seeking loan/debt investment. Attractive income option for investor. Available
SJD-2449
CaliforniaTrauma treatment facility. Searching for real estate partner to buy property and lease back, as well as further expansion. Great business plan and current growth and new contracts. Great results and outcomes. Available
SJD-6424
Colorado65 bed full continuum treatment center in Mountain West. #1 million EBITDA. Motivated seller seeking timely close. Great census and solid numbers.Available
SJD-1453
FloridaMedicare/Medicaid certified home health agency. $2.5 million annual revenue. 5-star. Accredited. District 10.Available
SBA-8305
Florida$2.5 million Medicare agency in Port St. Lucie. Great reputation and clinicals.Available
SCM-6191

FloridaNon-skilled home care agency. $600,000 in annual revenue. Outstanding reputation and quality service. Key staff in place. District 5.Available
SBA-3885
FloridaMedicare certified home health agency. Approximately $400,000 in annual revenue. Accredited. District 7.Available
SBA-9008
FloridaMedicare certified home health agency. District 10. Census: Minimal. Accredited.Available
SBA-1233
FloridaMedicare certified home health agency. Accredited. Minimal census. District 3.Available
SBA-7932
Georgia$5 million annual revenue private duty agency. Metro Atlanta service area. Well-positioned for additional growth. Available
SBB-5907
GeorgiaID/DD Services. $1 million revenue. Residential and Day Services. Atlanta Suburb. Available
SBH-6806
Illinois$5.5 million accredited Medicare agency located in northeastern Illinois. Strong bottom line. 4 1/2 star rating by CMS.Available
SBA-2734

Illinois$2.8 million Home Health agency. 100% Medicare. Loyal caregiver and patient base. Available
SCM-3291
Indiana$6 million annual revenue. Medicare/Medicaid home health agency. Serves Valparaiso and surrounding areas. CHAP accreditedAvailable
SBB-9361
IndianaGreater Indy metro area. $6 million revenue. Medicare certified. Diverse payor mix. Long history in the community.Available
SBB-5251
Maryland/DC/VirginiaLarge Medicare & Medicaid home care agency. Poised for continued growth.Available
SBB-7499
Massachusetts$10+ million Medicare and Medicaid certified Home Health agency. Diverse payor sources. Strong Management in place.Available
SBA-6010
Minnesota$8 million Medicaid agency. Well-established in metropolitan service area with staff in place.Available
SBB-7085
New YorkLHCSA in New York metro area. $10 million annual revenue. Consistent growth year over year. Available
SBB-8249
New YorkAnnualizing at $1.3 million revenue. 40% Non-Medicare/Private Insurance skilled nursing. 45% Managed LTC. Southern New York. Joint Commission Accreditation.Available
SBA-6824
New Mexico$2.5 million New Mexico home health agency. 87% Medicare. Long history in the community. Staff in place.Available
SBA-5295
North Carolina$1 million ID/DD Agency. Long-term client base. Growth potential with real estate. Strong margins. Available
SBH-9905
OhioMedicare/Medicaid agency in Columbus area. $4.5 million annual revenue. Long-standing reputation in the community. Profitable.Available
SBB-9067
OhioSoutheastern Ohio. $3.5 million annual revenue. Diverse referral source mix.Available
SBB-4298
OhioMedicare/Medicaid home health agency. $250,000 annual revenue. Accredited.Available
SBA-3951
Oregon$1.4 million Private Duty business located in Central OR. Serving an affluent community near local resort for over 30 years. Long term employees in place with well-established referral base.Available
SCM-7208
PennsylvaniaPrivate duty, non-medical home care company. $9.9 million current annual run rate. Eastern Pennsylvania. Highly profitable. Strong management team in place.Available
SBA-1009
Pennsylvania$4.3 million revenue. Home health, home care and hospice agency. 18% bottom line. Available
SJL-7605
Southeastern US$9+ million revenue with 16% bottom line. Home health with multiple locations. Regional presence with high star ratings. Nationally recognized for excellent patient outcomes. Lots of opportunity for growth. Available
SJL-5558
Southeast/Midwest8 locations, 6 cities with over 100 employees. Mental health/Psych/Therapy/Counseling/School based/SUD IOP pilot. $4.5 million revenue. $750,000 EBITDA. Huge growth opportunity and great business, reputation, and numbers. Available
SJD-7830
Southwest$5+ million outpatient treatment center. Fully accredited. 37 beds. Recently revamped to increase growth and margin. Great census, UR, acquisition and solid numbers. Out of network and transitioning some in network.Available
SJD-3448
TennesseeGreat opportunity for isolated campus setting full continuum SUD and mental health treatment center. Appalachian Mountain area. 8,700 square foot building currently on premises, professional kitchen, 6 bedrooms, 7 full baths, 4 half baths, swimming pool, tennis court. Hour away from metropolitan area.Available
SJD-8267
TexasAlmost 100% Medicare. Texas based home health agency. $6+ million revenue. Extremely profitable. Perfect surveys with a 4-star rating and consistently ranked as a top agency in the country.Available
SJL-5800
Texas$3+ million hospice agency based in Dallas/Fort Worth. Well established. Clinically clean and growing. Full staff in place. Available
SJL-6009
Texas$1 million revenue. Very clean and well established home health agency in the heart of West Texas. Fully staffed and ready for a new owner to step right in.Available
SJL-8770
Texas$1 million Medicare certified agency. Licensed in 7 counties in the Houston area. 80% is traditional Medicare. Available
SBA-1542
Texas$450,000+ Medicare certified Dallas area home care company. Fully staffed & clean clinically.Available
SJL-3334
Texas165 patient pediatric home care company in Houston, TX. Diverse referral network. Systems and staff in place. Available
SJL-4615
TexasClean hospice provider number. Located in the Ft. Worth, TX area.Available
SJL-5067
TexasClean hospice provider number. Located in West Texas.Available
SJL-2984
Upper Midwest$7.6 million revenue. Profitable home health and hospice. JCAHO accredited. 4-star rating. Ranked as a top performer in agency outcomesAvailable
SJL-2770
USAMedicare certified home health agency and hospice. Providing home health, personal care, and hospice services. $14.5 million current annual run rate. Strong financials. Accredited. Strong management team in place. Excellent reputation and outcomes. Multiple locations. Franchise to one of the nations top franchisors.Available
SCM-2994
Virginia$6 million Medicare certified agency in Northern Virginia. Available
SBA-7366
Virginia$1.2 million private duty/private pay home health business in Northern Virginia. Located in one of the most affluent counties in the country where the elderly population growth is outpacing the nations.Available
SCM-1483
Washington DCOpportunity to establish a Medicare/Medicaid home health agency. Certificate of Need subject to regulatory approval. Rare offering. Available
SBB-6706
Florida$9.5 million Home Health Agency located on Florida's East Coast. Very strong operationally, clinically, and financially. 99% of revenue comes from traditional Medicare. Under Contract
SCM-6925

FloridaMedicare certified home health agency. $4.7 million in revenue. Accredited. 4.5 stars. District 7. Great management team in place.Under Contract
SBA-8426
Florida$1.5 million non-skilled private duty home health business. Strong management team in place. District 1.Under Contract
SCM-1148
Ohio$2 million ID/DD Provider. Diversified services. Highly profitable (20%+). Tenured management with growth opportunities.Under Contract
SBH-3347
Pacific Northwest$ 3 million full continuum of care substance abuse treatment facility. Long time, well established business. Mostly Medicaid. Great opportunity. Under Contract
SJD-4921
South Central US$24 million annual revenue. Home health/Home care agency with small hospice operation. Well diversified payor mix. Medicare certified Multi State agency. Accredited. Strong management team in place.Under Contract
SCJ-5009
Southwest$25 million in annual revenue. Provider of Waiver and ICF ID/DD Services. Statewide Platform. Strong management team. Excellent reputation for quality services. Under Contract
SBH-2042
Texas$3.6 million Hospice, home health and palliative care agency. 90% Traditional Medicare. Service area in 13 counties around Harris County. CHAP accredited. Staff in place. Under Contract
SBA-7440
Texas$2.3 million Medicare revenue. 85% Traditional Medicare. Service area in 5 counties around Taylor County, as well as Region 2 & 9.Under Contract
SBA-3650

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.

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Home Health Index February 2019 | Stoneridge Partners

From Rich Tinsley, Publisher of “Home Health Index”. Rich can be reached at rich@stoneridgepartners.com 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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