LHC Group (NASDAQ:LHCG) broke out to a new all time high today following an excellent earnings report.
LHC Group provides post-acute healthcare services primarily to Medicare beneficiaries in rural markets in the southern United States. The Company provides home-based services, primarily through home nursing agencies and hospices, and facility-based services, primarily through long-term acute care hospitals and outpatient rehabilitation clinics. LHC Group operates in Louisiana, Mississippi, Arkansas, Alabama, Texas and West Virginia. As of December 31, 2005, the Company owned and operated 81 home nursing locations and four hospices. LHC Group also managed three home nursing agencies and one hospice as of December 31, 2005, in which it has no ownership interest. As of December 31, 2005, the Company also owned and operated five long-term acute care hospitals with a total of eight locations and four outpatient rehabilitation clinics, as well as managed the operations of one inpatient rehabilitation facility.
FUNDAMENTALS: A bit erratic at times, but LHC Group is a company that grows every year, often exceptionally. In 2006 profts grew 50% which follows a tripling of profits the year before. Growth is expected to moderate a bit in the next several quarters but remain solid in the 20% range. Margins aren't great, but solid and trending higher. Return on equity is excellent at around 18%. Management owns a significant portion of the company (35%) and more institutions are initiating positions for the first time. It all adds up to a very bullish fundamental picture. Home health care in general will continue to do well for many years to come as the boomers begin to age and require greater medical assistance. LHCG is one of the best in this space in my opinion.
TECHNICAL: The technical picture is equally as bullish after the stock broke out today with big volume to a new all time high after reporting outstanding earnings and sales.
Full Disclosure: Author has no position in above-mentioned company.
LHCG 1-yr chart