Can Lower Expenses Save Pediatrix Medical's Q1 Earnings?

Core Viewpoint - Pediatrix Medical Group, Inc. is expected to report its first-quarter 2025 results on May 6, 2025, with earnings estimated at 25 cents per share and revenues at $454.5 million, indicating a year-over-year earnings increase of 25% but a revenue decrease of 8.2% [1][2]. Financial Estimates - The Zacks Consensus Estimate for Pediatrix Medical's total revenues for 2025 is $1.9 billion, reflecting a year-over-year decline of 6.6%. The EPS estimate for the current year stands at $1.55, suggesting a growth of 2.7% year-over-year [2]. - The earnings estimate for the first quarter has remained stable over the past 60 days, with the company having beaten consensus earnings estimates in the previous four quarters by an average surprise of 19.4% [2][3]. Earnings Prediction Model - The current model indicates that Pediatrix Medical has an Earnings ESP of 0.00% and a Zacks Rank of 2 (Buy), which does not strongly predict an earnings beat for the upcoming quarter [3]. Revenue Factors - The Zacks Consensus Estimate for first-quarter net patient service revenue indicates a 7.6% year-over-year decline, while hospital contract administrative fees are expected to decline by 10.7% from the previous year, impacting the company's top line [5]. - The same-facility revenue growth is estimated at 0.75%, with patient volume growth at 0% and net reimbursement growth at 0.75%. NICU patient days growth is projected at 1.9% [6]. Operating Expenses - The model estimates a more than 10% year-over-year decline in total operating expenses, attributed to lower practice salaries and benefits, practice supplies, and general administrative costs. The first-quarter interest expense is projected at $8 million, continuing a year-over-year decline [7]. - The adjusted net income for the first quarter is expected to be nearly $21 million, representing a significant increase from the same period last year [7].