Healthways: Major Strategic Change Creates Upside
Shaun Currie, CFA
Shaun Currie, CFA
Thu, Jul. 28, 12:11 PM
- Thinly traded wellness firm Healthways (HWAY +31.9%) heads north on a healthy 20x surge in volume in response to its announcement that it has completed its evaluation of strategic alternatives aimed at boosting shareholder value.
- The company will sell its Total Population Health Services (TPHS) unit to Atlanta, GA-based Sharecare. Under the terms of the agreement, Sharecare will issue to Healthways an equity right that is convertible into up to $30M of Sharecare common stock, subject to conditions. Healthways will pay Sharecare $25M to fund expected negative cash flow for the 12-month period after the deal closes, expected by end of the month.
- Heathways CEO Donato Tramuto will join Sharecare's board in order to provide continuity of customer relationship management. TPHS President Sean Slovenski will join Sharecare as President of its population health business. Healthways CFO Alfred Lumsdaine will also join Sharecare as COO and CFO in ~60 days. A search for a new Healthways CFO is underway.
- Healthways plans to complete the restructuring of its corporate support infrastructure by year end to align with its focus on its Network Solutions business. It expects to end the year with annualized revenues greater than $500M, EBITDA margins greater than 20% and a minimum of upper-single-digit organic growth.
Jan. 26, 2015, 7:39 AM
- Healthways (NASDAQ:HWAY) hires J.P. Morgan Securities to assist it in evaluating strategic alternatives to enhance shareholder value.
- The company is due to report Q4 and full-year results on February 24. Consensus view for Q4 is EPS of $0.19 on revenues of $197.8M.
- Shares are up 13% premarket on light volume.