Key Takeaways Amedisys is leveraging strategic deals and CMS programs to expand its home health and hospice footprint. AMED maintained a 4.18 average Quality of Patient Care rating, with 88% of centers scoring 4 stars or more. Amedisys faces pressure from rising labor costs and a fragmented, highly competitive care provider market.Amedisys’ (AMED) valuable partnerships and acquisitions are expected to generate significant synergies in the upcoming quarters. The company’s continuously improving clinical qu ...

Investors interested in Medical stocks should always be looking to find the best-performing companies in the group. Is Amedisys (AMED) one of those stocks right now? Let's take a closer look at the stock's year-to-date performance to find out.Amedisys is one of 997 companies in the Medical group. The Medical group currently sits at #5 within the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual ...

Financial Performance - For the three-month period ended March 31, 2025, net service revenue increased to $594.8 million, up from $571.4 million in the same period of 2024, representing a year-over-year growth of approximately 4.4%[126] - Operating income for the same period rose to $43.4 million, an increase of $12 million compared to $31.6 million in 2024[126] - The gross margin improved slightly to 43.8% of revenue in 2025, compared to 43.7% in 2024[126] - Net income attributable to Amedisys, Inc. increased significantly to $61.0 million, compared to $14.4 million in the prior year, marking a growth of over 323%[126] Revenue Sources - The company derived approximately 69% of its consolidated net service revenue from Medicare for the three-month period ended March 31, 2025[113] - Total net service revenue for the home health segment increased by $15 million to $379.2 million, driven by a 5% growth in same store total volume and improved collections[130][133] - Operating income for the home health segment rose to $62.3 million, up from $60.8 million, primarily due to volume growth and increased Medicare reimbursement[130][131] - The hospice segment's net service revenue increased by $5 million to $206.2 million, with Medicare revenue growing by 4% year-over-year[136][139] - The high acuity care segment achieved a total admissions growth of 31%, with net service revenue rising to $9.4 million from $6.4 million[142][144] Expenses and Costs - Amedisys incurred $17 million in merger-related expenses for the three-month period ended March 31, 2025, down from $21 million in the same period of 2024[126] - General and administrative expenses for the corporate segment decreased by $6 million year-over-year to $63.5 million, including a $4 million reduction in merger-related expenses[147][148] - Cash used in operating activities was $3.7 million, a slight improvement from $6.5 million in the prior year, impacted by accounts payable and accrued expenses[149] - Cash used in investing activities totaled $1.4 million, down from $3.1 million, primarily for property and equipment purchases[150] - Cash used in financing activities increased to $13.3 million from $8.6 million, mainly due to repayment of borrowings[151] Legal and Regulatory Matters - The proposed merger with UnitedHealth Group is currently facing legal challenges, with a trial tentatively set to begin on October 27, 2025[116] - The Centers for Medicare and Medicaid Services (CMS) estimated a 2.9% increase in hospice payments for fiscal year 2025, effective October 1, 2024[123] - CMS also projected a 0.5% increase in payments to home health providers for the Calendar Year 2025[125] Cash and Debt Management - Cash and cash equivalents as of March 31, 2025, totaled $284.9 million, with $508.0 million available under the $550.0 million Revolving Credit Facility[154] - The company has no outstanding borrowings under the $550.0 million Revolving Credit Facility as of March 31, 2025, with a weighted average interest rate of 6.0% for the Amended Term Loan Facility[162] - A 1.0% change in interest rates would result in an approximate $3.4 million annual change in interest expense, based on $343.8 million of outstanding debt subject to interest rate fluctuations[166] - The Fourth Amendment to the Credit Agreement extended the maturity date of the Credit Facility from July 30, 2026, to July 30, 2027[160] Operational Challenges - The company experienced a cybersecurity incident affecting Change Healthcare, which delayed claim submissions but had minimal impact on Medicare claims[153] - The company expects continued operating losses in the high acuity care segment but anticipates improvements as it leverages its operating structure[143] - Inflation has materially impacted operations, particularly in labor and healthcare costs, with expectations for continued effects in 2025[164] Accounts Receivable - Patient accounts receivable increased by $24 million from December 31, 2024, with cash collection as a percentage of revenue at 97% for Q1 2025, up from 93% in Q1 2024[156] - Days revenue outstanding as of March 31, 2025, was 45.7 days, an increase of 2.7 days from December 31, 2024, but a decrease of 8.4 days compared to March 31, 2024[156] - Total patient accounts receivable as of March 31, 2025, was $319.6 million, compared to $296.1 million at December 31, 2024[158]

Company Performance - Amedisys reported quarterly earnings of $1.25 per share, exceeding the Zacks Consensus Estimate of $1.13 per share, and up from $1.03 per share a year ago, representing an earnings surprise of 10.62% [1] - The company posted revenues of $594.78 million for the quarter ended March 2025, which aligns with the Zacks Consensus Estimate and shows an increase from $571.41 million year-over-year [2] - Over the last four quarters, Amedisys has surpassed consensus EPS estimates two times and topped consensus revenue estimates once [2] Future Outlook - The sustainability of Amedisys's stock price movement will depend on management's commentary during the earnings call and future earnings expectations [3] - The current consensus EPS estimate for the upcoming quarter is $1.43 on revenues of $616.25 million, and for the current fiscal year, it is $4.78 on revenues of $2.45 billion [7] - The estimate revisions trend for Amedisys is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Medical - Outpatient and Home Healthcare industry, to which Amedisys belongs, is currently ranked in the top 8% of over 250 Zacks industries, suggesting a favorable outlook [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Amedisys's performance [5]

Core Viewpoint - Amedisys, Inc. reported strong financial results for the first quarter of 2025, highlighting significant growth in net service revenue and net income, alongside the context of a pending merger with UnitedHealth Group [1][3][6]. Financial Performance - Net service revenue increased by $23.4 million to $594.8 million compared to $571.4 million in the same period of 2024 [6]. - Net income attributable to Amedisys, Inc. was $61.0 million, which included merger-related expenses of $16.8 million and a gain of $48.1 million on an equity method investment [6][12]. - Adjusted EBITDA for the quarter was $68.8 million, up from $59.9 million in 2024 [6][19]. - Adjusted net income attributable to Amedisys, Inc. was $41.6 million, compared to $33.9 million in 2024 [6][20]. Earnings Per Share - Net income attributable to Amedisys, Inc. per diluted share was $1.84, a significant increase from $0.44 in 2024 [6][21]. - Adjusted net income attributable to Amedisys, Inc. per diluted share was $1.25, compared to $1.03 in the previous year [6][21]. Operational Highlights - The company operates approximately 519 care centers across 38 states and the District of Columbia, serving over 499,000 patients annually [5]. - Amedisys has partnerships with more than 3,300 hospitals and 114,000 physicians nationwide [5]. Merger Context - The company will not conduct a quarterly earnings call due to the pending merger with UnitedHealth Group, indicating a strategic focus on the merger process [3][6].

Financial Dates and Agreements - The Fourth Amendment Effective Date is April 17, 2025[5] - The Revolving Facility Maturity Date is set for July 30, 2027[7] - The Term Facility Maturity Date is also July 30, 2027[8] - The principal amortization payment schedule includes 0.625% payments from December 2021 to September 2023, followed by 1.250% payments from December 2023 to June 2027[11][12] - The Credit Agreement allows for Conforming Changes to be made by the Administrative Agent[3] - The definitions of "Term SOFR" and "U.S. Government Securities Business Day" have been amended[9][10] - The Company is required to reimburse the Administrative Agent for all reasonable fees and expenses related to the Agreement[18] - The Loan Parties confirm that the Collateral Documents remain in full force and effect[20] Outbound Investment Rules - The Company and its Subsidiaries are not classified as "covered foreign persons" under the Outbound Investment Rules[13] - The Company has no current intention to engage in any "covered activity" or "covered transaction" as defined by the Outbound Investment Rules[13] Company Performance and Growth - Amedisys, Inc. reported a significant increase in revenue, achieving $500 million for the quarter, representing a 15% year-over-year growth[29] - The company reported a significant increase in revenue, achieving $1.2 billion for the quarter, representing a 15% year-over-year growth[1] - Amedisys provided an optimistic outlook, projecting a revenue growth of 12% to 15% for the next fiscal year[31] - The company provided an optimistic outlook, projecting a revenue growth of 10-12% for the next quarter[1] User and Market Expansion - The company expanded its user base, serving over 40,000 patients, which is a 10% increase compared to the previous quarter[30] - User data showed a 20% increase in active users, reaching 2 million by the end of the quarter[1] - Market expansion efforts have led to the opening of 10 new locations across three states, increasing the company's footprint by 25%[1] - Amedisys plans to expand its market presence by entering three new states, aiming to increase its service locations by 25%[33] Investments and Acquisitions - The company is investing in new technology, with a budget of $20 million allocated for the development of telehealth services[32] - The company is investing $50 million in research and development for new technologies aimed at improving patient care[1] - Amedisys is actively pursuing acquisitions, targeting to acquire at least two home health agencies in the next quarter[34] - The company is exploring potential acquisitions to enhance service offerings, with a target of completing at least one acquisition by the end of the fiscal year[1] - A new strategic partnership was announced, expected to generate an additional $30 million in revenue over the next two years[1] Operational Efficiency and Quality - Amedisys reported an increase in operating margin to 18%, up from 16% in the previous year[35] - The company reported a 12% increase in operating margin, reflecting improved efficiency and cost management[1] - The company has launched a new patient management system, which is expected to improve operational efficiency by 20%[36] - Amedisys emphasized its commitment to quality care, achieving a patient satisfaction score of 92%, which is above the industry average[29] - Customer satisfaction ratings improved to 92%, up from 88% in the previous quarter, indicating enhanced service quality[1] - The company is focusing on strategic partnerships with local healthcare providers to enhance service delivery and patient outcomes[30]

Core Viewpoint - Amedisys (AMED) shares have increased by approximately 1.3% since the last earnings report, outperforming the S&P 500, raising questions about the sustainability of this positive trend leading up to the next earnings release [1] Group 1: Earnings Report and Market Reaction - The most recent earnings report is crucial for understanding the catalysts affecting Amedisys [1] - Fresh estimates for Amedisys have remained flat over the past month, indicating a lack of significant changes in market expectations [2] Group 2: VGM Scores and Investment Strategy - Amedisys currently holds a Growth Score of A, but has a low Momentum Score of F, while receiving a B grade for value, placing it in the top 40% for this investment strategy [3] - The aggregate VGM Score for Amedisys is A, which is relevant for investors not focused on a single strategy [3] Group 3: Outlook - Amedisys has a Zacks Rank of 3 (Hold), suggesting an expectation of an in-line return from the stock in the upcoming months [4]

Core Viewpoint - Amedisys is positioned for growth due to its improving clinical quality and strategic partnerships, although macroeconomic challenges and competitive pressures may limit its potential [1][6]. Group 1: Clinical Quality and Patient Satisfaction - Amedisys has achieved high Quality of Patient Care and Patient Satisfaction star ratings, with an average Quality of Patient Care star rating of 4.18 and 88% of care centers rated 4 stars or higher [3][4]. - The company's Patient Satisfaction star average is 4.02, which exceeds the industry average [3]. Group 2: Strategic Initiatives - Amedisys is expanding its business through acquisitions and partnerships, including Contessa Health's participation in a new Medicare alternative payment model aimed at dementia care [4][5]. - The introduction of advanced molecular testing in collaboration with Patient Choice Laboratories is part of Amedisys' strategy to enhance its service offerings [5]. Group 3: Financial Performance and Market Position - Amedisys has a market capitalization of $3.03 billion and an earnings yield of 5.2%, which is higher than the industry's 4.4% [2]. - The Zacks Consensus Estimate for 2025 earnings per share is $4.45, with revenues projected at $2.46 billion, reflecting a 5% increase from the previous year [11]. Group 4: Market Challenges - The company faces macroeconomic pressures, including rising costs of services, which increased by 7.2%, leading to a gross margin contraction of 131 basis points in Q4 2024 [6][7]. - Amedisys operates in a fragmented market with significant competition from local providers and non-profit organizations, which may impact its growth [8][10].

Core Viewpoint - Amedisys, Inc. reported lower-than-expected earnings and revenues for the fourth quarter of 2024, with both metrics missing consensus estimates, despite some growth in service revenues and adjusted earnings per share [10][11]. Financial Performance - Adjusted EPS for Q4 2024 was 96 cents, a 2.1% increase year over year, but missed the Zacks Consensus Estimate by 8.6% [1][2]. - Full-year 2024 adjusted EPS was $4.32, up 0.5% year over year [2]. - Net service revenues for Q4 totaled $598.0 million, a 4.8% increase year over year, but slightly missed the Zacks Consensus Estimate by 0.02% [3]. - Full-year 2024 net service revenues reached $2.35 billion, up 4.9% year over year [3]. Segment Performance - Home Health division revenues were $377.0 million, up 5% year over year, with Medicare revenues decreasing by 3.9% to $212.4 million, while non-Medicare revenues increased by 19.4% to $164.6 million [4]. - Hospice division revenues were $212.9 million, a 3.3% increase year over year, with Medicare revenues up 4.2% to $202.4 million, and non-Medicare revenues down 11% to $10.5 million [4]. - High Acuity Care segment reported revenues of $8.1 million, compared to $5.9 million in the previous year [5]. Margins and Expenses - Gross profit increased by 1.6% to $253.4 million, but gross margin fell by 131 basis points to 42.4% due to a 7.2% rise in service costs [6]. - SG&A expenses rose by 1.9% to $137.6 million, while other expenses increased by 1.0% to $58 million [6]. - Adjusted operating profit was $57.8 million, up 1.7% year over year, but adjusted operating margin contracted by 29 basis points to 9.7% [6]. Liquidity and Cash Position - Amedisys ended 2024 with cash and cash equivalents of $303.2 million, up from $126.4 million at the end of 2023 [7]. - Long-term obligations totaled $339.3 million at the end of 2024, down from $361.9 million at the end of 2023 [7]. - Cumulative net cash from operating activities was $221.7 million, compared to $137.2 million a year ago [7]. Merger Developments - Amedisys is in the process of merging with UnitedHealth Group's Optum, which aims to enhance value-based care [8]. - A purchase agreement was signed for the sale of certain home health care centers to VCG Luna, LLC, contingent on the successful closing of the merger [9].

Company Overview - Amedisys operates three segments: home health, hospice, and high acuity care, with approximately 19,000 employees across 519 care centers in 38 states[18]. - The home health segment includes 347 care centers and performed over 10.7 million visits for more than 499,000 patients annually[18][22]. - The high acuity care segment was established through the acquisition of Contessa Health on August 1, 2021, enhancing Amedisys's capabilities in delivering inpatient-level care at home[28]. - The company divested its personal care business on March 31, 2023, streamlining its focus on core healthcare services[31]. - Amedisys has approximately $1.2 billion in goodwill as of December 31, 2024, with additional acquisitions likely to increase this amount[186]. - The company employs around 19,000 employees across various segments, including 11,800 in home health and 6,100 in hospice[183]. Financial Performance - Medicare accounts for approximately 70% to 74% of Amedisys's net service revenue over the last three years, highlighting the company's reliance on government payors[19]. - Medicare accounted for 70%, 73%, and 74% of the company's consolidated net service revenue during 2024, 2023, and 2022, respectively[137]. - The 2025 Home Health Final Rule is expected to result in a 0.5% increase in payments to home health providers, driven by a 2.7% payment update offset by adjustments totaling -2.2%[47]. - CMS estimates a 2.9% increase in hospice payments for fiscal year 2025, with the aggregate cap amount raised to $34,465[52]. - The total temporary adjustment calculated for CY 2020 through CY 2023 is $4.5 billion, with future proposals to convert this amount into a factor applied to base payment rates[47]. - The company anticipates financial benefits from acquisitions, contingent on improving clinical performance and controlling costs[197]. Regulatory Compliance - Compliance with Medicare requirements is monitored through established processes and controls over coding, billing, and patient recertifications[62]. - The company is subject to various audits and compliance reviews by Medicare, which can result in claim adjustments or overpayment determinations[48]. - Compliance with Medicare regulations is essential for participation in the Medicare program, which includes conditions of participation and payment standards[72]. - The company is subject to various federal and state anti-fraud and abuse laws, including the federal Anti-Kickback Statute and the Stark Law, which impose significant penalties for violations[78][81]. - The company must comply with HIPAA regulations, which impose standards for the use and disclosure of health information, with penalties for violations ranging from $141 to a maximum of $2.134 million[93]. - The Improving Medicare Post-Acute Care Transformation Act (IMPACT Act) requires standardized patient assessment data reporting, with penalties for non-compliance resulting in a 2% reduction in market basket prices[98]. Merger and Acquisition Activities - Amedisys entered into a merger agreement with UnitedHealth Group on June 26, 2023, which will result in Amedisys becoming a wholly owned subsidiary[34]. - The proposed Merger with UnitedHealth Group is subject to various closing conditions, including government approvals, which may not be satisfied by the end of the Waiver Period[122]. - Amedisys has incurred significant costs related to the Merger, including potential termination fees of $125 million under certain circumstances[128]. - The ongoing DOJ Action against the Merger creates uncertainty regarding its completion timeline and conditions[124]. - If the Merger is not completed, Amedisys will remain a public company and continue to face risks that could adversely affect its business and stock price[127]. - The Merger Agreement includes restrictions on Amedisys's business activities, potentially limiting strategic opportunities during the pending period[128]. Quality of Care - Amedisys's Quality of Patient Care star average is 4.18, with 88% of care centers rated at 4+ stars, indicating a strong commitment to clinical quality[24]. - Amedisys's hospice outreach strategy has increased its patient population to better reflect community health needs, focusing on conditions like heart disease and dementia[27]. - Quality patient care is crucial for generating referrals; failure to meet quality metrics could adversely impact the company's business[161]. - The company must maintain relationships with existing patient referral sources, as their loss could materially affect financial performance[164]. Operational Risks - The company faces competition from local, publicly-owned, and hospital-owned health care providers, competing primarily on service quality and personnel availability[113]. - A shortage of qualified clinicians could increase operating costs and adversely affect the company's ability to attract and retain personnel[158]. - Cybersecurity threats pose significant risks to the company's operations, and a breach could lead to substantial costs and reputational harm[171]. - The company relies on third-party vendors for critical information systems, and any security incidents involving these vendors could disrupt operations and impact financial performance[176]. - A recent cyber-attack on a subsidiary resulted in an estimated increase of approximately $60 million in accounts receivable due to delays in submitting non-Medicare claims[176]. Economic and Market Conditions - The ongoing inflationary environment has led to increased labor and healthcare costs, impacting the company's financial condition[189]. - Economic downturns and federal budget pressures may result in reduced payments and covered services under Medicare and Medicaid programs, adversely affecting the company's financial condition[154]. - The company is exposed to geopolitical tensions, such as the Russia-Ukraine conflict, which may disrupt global supply chains and financial markets[188]. Future Outlook - Future changes in Medicare reimbursement policies could materially affect the company's financial condition and results of operations[139]. - The home health and hospice industry is highly competitive, with few barriers to entry, which may limit the company's market share[165]. - The success of the high acuity care segment depends on entering into risk-based contracts with managed care health plans; failure to do so could adversely affect financial results[169]. - The implementation of value-based purchasing could lead to adjustments in Medicare payments based on performance against quality measures, potentially impacting revenue[153].