Amedisys, Inc., together with its subsidiaries, provides healthcare services in the United States. It operates through three segments: Home Health, Hospice, and High Acuity Care. The Home Health segment offers a range of services in the homes of individuals for the recovery of patients from surgery, chronic disability, or terminal illness, as well as prevents avoidable hospital readmissions through its skilled nurses; nursing services, rehabilitation therapists specialized in physical, speech, and occupational therapy; and social workers and aides for assisting its patients. The Hospice segment offers services that is designed to provide comfort and support for those who are dealing with a terminal illness, including cancer, heart disease, pulmonary disease, or Alzheimer's. The High Acuity Care offers essential elements of inpatient hospital, skilled nursing facility care, and palliative care to patients in their homes. Amedisys, Inc. was incorporated in 1982 and is headquartered in Baton Rouge, Louisiana.

Amedisys Inc

DexCom (NASDAQ:DXCM) stock experienced a significant 16% surge on Friday following its Q1 earnings release and a share buyback announcement. The company’s first-quarter sales reached $1.04 billion, exceeding the anticipated $1.02 billion. However, its earnings per share (EPS) of $0.32 fell slightly short of the $0.33 consensus estimate. Additionally, while DexCom reaffirmed its full-year sales outlook, it revised its gross margin forecast downward to 62%, a decrease from the previous range of 64-65%. Despite these mixed financial results, the primary catalyst for the stock’s upward movement appears to be the company’s announcement of a $750 million share repurchase program.
Following this recent quarterly performance and the subsequent stock price increase, a key question emerges: is DXCM stock a buy at its current level above $80? We don’t think so. We believe that DXCM appears to be an expensive stock at its present valuation.
This conclusion is based on a comparative assessment of DXCM’s current valuation against its recent operating performance, as well as its current and historical financial standing. Our evaluation of DexCom across crucial dimensions—Growth, Profitability, Financial Stability, and Downturn Resilience—reveals a company with robust operating performance and a strong financial condition, the details of which are provided below.
That said, if you seek upside with lower volatility than individual stocks, the Trefis High-Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.
How Does DexCom’s Valuation Look vs. The S&P 500?
Going by what you pay per dollar of sales or profit, DXCM stock looks expensive compared to the broader market.
DexCom has a price-to-sales (P/S) ratio of 8.0 vs. a figure of 2.8 for the S&P 500
Additionally, the company’s price-to-free cash flow (P/FCF) ratio is 28.1 compared to 17.6 for S&P 500
And, it has a price-to-earnings (P/E) ratio of 60.9 vs. the benchmark’s 24.5
How Have DexCom’s Revenues Grown Over Recent Years?
DexCom’s Revenues have seen notable growth over recent years.
DexCom has seen its top line grow at an average rate of 18.2% over the last 3 years (vs. increase of 6.2% for S&P 500)
Also, its quarterly revenues grew 12% to $1.04 Bil in the most recent quarter from $921 Mil a year ago (vs. 4.9% improvement for S&P 500)
How Profitable Is DexCom?
DexCom’s profit margins are around the median level for companies in the Trefis coverage universe.
DexCom’s Operating Income over the last four quarters was $633 Mil, which represents a moderate Operating Margin of 15.2% (vs. 13.1% for S&P 500)
DexCom’s Operating Cash Flow (OCF) over this period was $964 Mil, pointing to a good OCF Margin of 23.2% (vs. 15.7% for S&P 500)
For the last four-quarter period, DexCom’s Net Income was $535 Mil — indicating a moderate Net Income Margin of 12.9% (vs. 11.3% for S&P 500)
Does DexCom Look Financially Stable?
DexCom’s balance sheet looks very strong.
DexCom’s Debt figure was $2.6 Bil at the end of the most recent quarter, while its market capitalization is $32 Bil (as of 5/2/2025). This implies a strong Debt-to-Equity Ratio of 9.3% (vs. 21.5% for S&P 500). [Note: A lower Debt-to-Equity Ratio is desirable]
Cash (including cash equivalents) makes up $2.6 Bil of the $6.5 Bil in Total Assets for DexCom. This yields a very strong Cash-to-Assets Ratio of 39.8% (vs. 15.0% for S&P 500)
How Resilient Is DXCM Stock During A Downturn?
DXCM stock has seen an impact that was worse than the benchmark S&P 500 index during some of the recent downturns. Worried about the impact of a market crash on DXCM stock? Our dashboard How Low Can DexCom Stock Go In A Market Crash? has a detailed analysis of how the stock performed during and after previous market crashes.
Inflation Shock (2022)
DXCM stock fell 58.2% from a high of $162.81 on 17 November 2021 to $67.99 on 16 June 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
The stock is yet to recover to its pre-Crisis high
The highest the stock has reached since then is $140.45 on 9 April 2024 and currently trades at around $82
COVID-19 Pandemic (2020)
DXCM stock fell 36.8% from a high of $75.63 on 20 February 2020 to $47.79 on 18 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
The stock fully recovered to its pre-Crisis peak by 16 April 2020
Global Financial Crisis (2008)
DXCM stock fell 87.0% from a high of $2.67 on 9 October 2007 to $0.35 on 20 November 2008, vs. a peak-to-trough decline of 56.8% for the S&P 500
The stock fully recovered to its pre-Crisis peak by 23 March 2010
Putting All The Pieces Together: What It Means For DXCM Stock
In summary, DexCom’s performance across the parameters detailed above are as follows:
Growth: Very Strong
Profitability: Neutral
Financial Stability: Extremely Strong
Downturn Resilience: Neutral
Overall: Strong
In summary, although DexCom demonstrates strong performance across key operational and financial metrics, this strength appears to be already reflected in the company’s high stock valuation. While the announced share buyback is undoubtedly a positive factor for the stock price, DexCom faces underlying fundamental risks. The increasing adoption of GLP-1 drugs is anticipated to lead to a contraction in the overall diabetes market in the coming years, which presents a significant headwind for DexCom. Furthermore, the near-term pressure on the company’s margins adds to these concerns. Consequently, we believe investors would be better positioned by waiting for a potential dip in price before considering an investment in DXCM stock.
The rich valuation of DXCM stock limits its upside potential in the near-to-mid term. As an alternative, the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid- and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Wait For A Dip To Buy DexCom Stock

DexCom (NASDAQ:DXCM) will release its earnings report on Thursday, May 1, 2025. Historically, the stock has exhibited significant volatility around its earnings announcements. Over the past five years, DXCM experienced a negative one-day return in 61% of instances, with a median negative return of -8.2% and a maximum negative return of -40.7%. This historical pattern suggests a high degree of price fluctuation during earnings periods.
For event-driven traders, understanding these historical tendencies can potentially offer an edge. Two primary strategies emerge: first, analyzing historical probabilities to establish a position before the earnings release; second, examining the correlation between immediate and medium-term returns after the announcement to inform subsequent positioning.
Currently, consensus estimates project earnings per share of $0.33 on revenue of $1.02 billion, compared to the prior year’s first quarter figures of $0.32 EPS on $921 million in sales.
From a fundamental perspective, DexCom currently holds a market capitalization of $28 billion, with a trailing twelve-month revenue of $4.0 billion, operating profits of $600 million, and a net income of $576 million.
If you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.
See earnings reaction history of all stocks
Image by Markus Winkler from Pixabay
DexCom’s Historical Odds Of Positive Post-Earnings Return
Some observations on one-day (1D) post-earnings returns:
There are 18 earnings data points recorded over the last five years, with 7 positive and 11 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 39% of the time.
Notably, this percentage increases to 45% if we consider data for the last 3 years instead of 5.
Median of the 7 positive returns = 9.3%, and median of the 11 negative returns = -5.0%
Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.
DXCM 1D, 5D, and 21D Post Earnings Return
Correlation Between 1D, 5D, and 21D Historical Returns
A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.
DXCM Correlation Between 1D, 5D and 21D Historical Returns
Is There Any Correlation With Peer Earnings?
Sometimes, peer performance can have influence on post-earnings stock reaction. In fact, the pricing-in might begin before the earnings are announced. Here is some historical data on the past post-earnings performance of DexCom stock compared with the stock performance of peers that reported earnings just before DexCom. For fair comparison, peer stock returns also represent post-earnings one-day (1D) returns.
DXCM Correlation With Peer Earnings
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

DexCom Earnings: What To Expect For The Stock?

(RTTNews) - Amedisys (AMED) announced earnings for its first quarter that increased from the same period last year and beat the Street estimates.
The company's bottom line totaled $61.01 million, or $1.84 per share. This compares with $14.40 million, or $0.44 per share, last year.
Excluding items, Amedisys reported adjusted earnings of $41.58 million or $1.25 per share for the period.
Analysts on average had expected the company to earn $1.11 per share. Analysts' estimates typically exclude special items.
The company's revenue for the period rose 4.1% to $594.78 million from $571.41 million last year.
Amedisys earnings at a glance (GAAP) :
-Earnings: $61.01 Mln. vs. $14.40 Mln. last year. -EPS: $1.84 vs. $0.44 last year. -Revenue: $594.78 Mln vs. $571.41 Mln last year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Amedisys Q1 Profit Increases, Beats Estimates

Amedisys (AMED) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended March 2025. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.
The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower.
While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on theearnings call it's worth handicapping the probability of a positive EPS surprise.
Zacks Consensus Estimate
This home health care and hospice services provider is expected to post quarterly earnings of $1.13 per share in its upcoming report, which represents a year-over-year change of +9.7%.
Revenues are expected to be $594.79 million, up 4.1% from the year-ago quarter.
Estimate Revisions Trend
The consensus EPS estimate for the quarter has been revised 0.61% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.
Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change.
Earnings Whisper
Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.
A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.
Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).
How Have the Numbers Shaped Up for Amedisys?
For Amedisys, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -12.06%.
On the other hand, the stock currently carries a Zacks Rank of #3.
So, this combination makes it difficult to conclusively predict that Amedisys will beat the consensus EPS estimate.
Does Earnings Surprise History Hold Any Clue?
While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.
For the last reported quarter, it was expected that Amedisys would post earnings of $1.05 per share when it actually produced earnings of $0.96, delivering a surprise of -8.57%.
Over the last four quarters, the company has beaten consensus EPS estimates two times.
Bottom Line
An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.
That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Amedisys doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.
Expected Results of an Industry Player
Among the stocks in the Zacks Medical - Outpatient and Home Healthcare industry, Quest Diagnostics (DGX) is soon expected to post earnings of $2.15 per share for the quarter ended March 2025. This estimate indicates a year-over-year change of +5.4%. This quarter's revenue is expected to be $2.61 billion, up 10.5% from the year-ago quarter.
The consensus EPS estimate for Quest Diagnostics has been revised 0.1% lower over the last 30 days to the current level. However, a lower Most Accurate Estimate has resulted in an Earnings ESP of -1.68%.
This Earnings ESP, combined with its Zacks Rank #3 (Hold), makes it difficult to conclusively predict that Quest Diagnostics will beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Should You Invest in Amedisys, Inc. (AMED)?
Before you invest in Amedisys, Inc. (AMED), want to know the best stocks to buy for the next 30 days? Check out Zacks Investment Research for our free report on the 7 best stocks to buy.
Zacks Investment Research has been committed to providing investors with tools and independent research since 1978. For more than a quarter century, the Zacks Rank stock-rating system has more than doubled the S&P 500 with an average gain of +24.08% per year. (These returns cover a period from January 1, 1988 through May 6, 2024.)
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Amedisys, Inc. (AMED) : Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Amedisys (AMED) Earnings Expected to Grow: Should You Buy?

Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Capricor Therapeutics Inc (Symbol: CAPR), where a total of 7,985 contracts have traded so far, representing approximately 798,500 underlying shares. That amounts to about 55.4% of CAPR's average daily trading volume over the past month of 1.4 million shares. Especially high volume was seen for the $15 strike call option expiring March 21, 2025, with 2,296 contracts trading so far today, representing approximately 229,600 underlying shares of CAPR. Below is a chart showing CAPR's trailing twelve month trading history, with the $15 strike highlighted in orange:
Amedisys, Inc. (Symbol: AMED) options are showing a volume of 2,010 contracts thus far today. That number of contracts represents approximately 201,000 underlying shares, working out to a sizeable 55% of AMED's average daily trading volume over the past month, of 365,140 shares. Especially high volume was seen for the $105 strike call option expiring April 17, 2025, with 2,000 contracts trading so far today, representing approximately 200,000 underlying shares of AMED. Below is a chart showing AMED's trailing twelve month trading history, with the $105 strike highlighted in orange:
And lululemon athletica inc (Symbol: LULU) options are showing a volume of 8,320 contracts thus far today. That number of contracts represents approximately 832,000 underlying shares, working out to a sizeable 52.4% of LULU's average daily trading volume over the past month, of 1.6 million shares. Especially high volume was seen for the $340 strike call option expiring April 17, 2025, with 1,666 contracts trading so far today, representing approximately 166,600 underlying shares of LULU. Below is a chart showing LULU's trailing twelve month trading history, with the $340 strike highlighted in orange:
For the various different available expirations for CAPR options, AMED options, or LULU options, visit StockOptionsChannel.com.
Also see:
WLMS Insider Buying
Institutional Holders of VOSO
Top Ten Hedge Funds Holding SPXN
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Noteworthy Thursday Option Activity: CAPR, AMED, LULU

Amedisys, Inc. AMED reported fourth-quarter 2024 adjusted earnings per share (EPS) of 96 cents, which rose 2.1% year over year. However, the metric missed the Zacks Consensus Estimate by 8.6%.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
The quarter’s adjustments include certain merger-related expenses and other (income)/expenses, net.
GAAP loss was 62 cents per share against EPS of 59 cents in the corresponding period of 2023.
Full-year 2024 adjusted EPS was $4.32, up 0.5% year over year.
Following the earnings announcement, AMED’s shares gained 0.1% last Thursday.
AMED’s Revenues
Net service revenues totaled $598.0 million, up 4.8% year over year. The top line missed the Zacks Consensus Estimate marginally by 0.02%.
Full-year 2024 net service revenues were $2.35 billion, up 4.9% year over year.
AMED’s Q4 Segmental Performance
Net service revenues from the Home Health division totaled $377.0 million, up 5% year over year.
Within the segment, Medicare revenues of $212.4 million decreased 3.9% year over year. Non-Medicare revenues improved 19.4% year over year to $164.6 million.
Within the Hospice division, net service revenues were $212.9 million (up 3.3% year over year), including Medicare revenues of $202.4 million (up 4.2%) and non-Medicare revenues of $10.5 million (down 11%).
The High Acuity Care segment reported net service revenues of $8.1 million compared with $5.9 million in the year-ago quarter. The Corporate segment did not register recognizable revenues in the fourth quarter.
Margins
The company's gross profit climbed 1.6% to $253.4 million in the quarter under review. However, the gross margin fell 131 basis points (bps) to 42.4% due to a 7.2% increase in the cost of services (including depreciation).
SG&A expenses on salaries and benefits rose 1.9% to $137.6 million. Other expenses rose 1.0% to $58 million. The adjusted operating profit amounted to $57.8 million, up 1.7% from the year-ago level. The adjusted operating margin contracted 29 bps to 9.7% from the prior-year figure.
AMED’s Q4 Liquidity and Cash Position
Amedisys exited 2024 with cash and cash equivalents of $303.2 million compared with $126.4 million at the end of 2023. The company's long-term obligations (excluding the current portion) totaled $339.3 million at the end of 2024 compared with $361.9 million at the end of 2023.
Cumulative net cash provided by operating activities at the end of the fourth quarter was $221.7 million compared with $137.2 million a year ago.
Developments on the Pending Merger
Amedisys’ impending merger with UnitedHealth Group’s Optum, announced in June 2023, brings together two organizations dedicated to providing compassionate, value-based, comprehensive care to patients and their families.
Amedisys, Inc. Price, Consensus and EPS Surprise
Amedisys, Inc. price-consensus-eps-surprise-chart | Amedisys, Inc. Quote
On June 28, 2024, Amedisys, UnitedHealth Group and certain of their respective subsidiaries entered into a purchase agreement relating to the sale of certain Amedisys home health care centers and UnitedHealth Group care centers to VCG Luna, LLC, an affiliate of VitalCaring. The divestiture is subject to several conditions, including the successful closing of the merger.
Our Take
Amedisys ended the fourth quarter of 2024 with lower-than-expected results, wherein both earnings and revenues missed estimates. Home Health service revenues benefited from total volume growth and per-visit rate increases. The Hospice segment’s growth was supported by an increase in reimbursement (effective Oct. 1, 2023) and a slight increase in the average daily census. The High Acuity Care segment achieved its highest total admissions volume since inception.
However, the cost of services in the Hospice and Home Health segments rose mainly due to planned wage increases, wage inflation, investments in hospice clinical staffing and an increase in health insurance costs.
On the flip side, the contraction of both margins in the quarter does not bode well for the stock. On a positive note, the company’s top and bottom lines surged in the quarter.
AMED’s Zacks Rank & Key Picks
AMED currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are ResMed RMD, Cardinal Health CAH and Insulet PODD.
ResMed reported a second-quarter fiscal 2025 adjusted EPS of $2.43, which topped the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%. RMD carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Cardinal Health, carrying a Zacks Rank #2 at present, posted a second-quarter fiscal 2025 adjusted EPS of $1.93, which outpaced the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.
CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
Insulet, presently carrying a Zacks Rank #2, posted a fourth-quarter 2024 adjusted EPS of $1.15, which topped the Zacks Consensus Estimate by 9.5%. Revenues of $597.5 million exceeded the Zacks Consensus Estimate by 2.7%.
PODD has an estimated long-term earnings growth rate of 20.3% compared with the industry’s 15.5%. Its earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 27.5%.
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This article originally published on Zacks Investment Research (zacks.com).
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

AMED Q4 Earnings and Revenues Miss, Margins Dip, Stock Rises

The U.S. Department of Justice has reportedly launched an investigation into UnitedHealth Group's (NYSE: UNH) Medicare billing practices.
Investors were shaken by the report, sending UnitedHealth shares down 9% as of 10 a.m. Eastern.
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Under the microscope
UnitedHealth is the parent of the nation's largest health insurer as well as a range of other health-industry businesses including doctors' practices and a pharmacy-benefit manager. The Wall Street Journal, citing unnamed sources, reported Friday that Justice is probing the company's billings.
The report says the government is looking into UnitedHealth practices for recording diagnoses that trigger extra payments to its Medicare Advantage plans, including at physician groups that the insurer owns.
Neither the company nor the Department of Justice had any comment on the report.
Medicare Advantage plans are private insurer plans in which the government pays a fixed amount to oversee Medicare benefits. Payments go up if patients have certain diagnoses, creating a potential incentive for the healthcare provider to diagnose more diseases.
Is UnitedHealth stock a buy?
The investigation is the latest worry for UnitedHealth, which is already facing an antitrust probe and regulatory pushback over its planned $3.3 billion acquisition of Amedisys. UnitedHealth has been pushed to the forefront of the heated debate over soaring healthcare costs and patient care.
UnitedHealth shares are now down 25% in the last three months.
Given the importance of healthcare and UnitedHealth's powerful role in the system, this company should have staying power and might look attractive to long-term focused investors. But with so much uncertainty hanging over the company right now, investors would be wise to stay away from UnitedHealth.
Should you invest $1,000 in UnitedHealth Group right now?
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Lou Whiteman has no position in any of the stocks mentioned. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Why UnitedHealth Stock Is Down Today

UnitedHealth Group Incorporated UNH and Amedisys, Inc. AMED have reportedly decided to cancel their plan to sell medical centers to Texas-based VitalCaring Group, a move initially intended to address antitrust concerns related to their $3.3 billion merger. This sale was part of an effort to gain regulatory approval for the merger between Amedisys and UNH’s subsidiary, Optum.
In November, the U.S. Department of Justice filed an antitrust lawsuit, arguing that the merger would give UnitedHealth too much control over the home health and hospice services market, particularly in eight states where it would control more than 30% of the market. This could negatively impact competition and affect home-based care workers and payers.
The divestment deal was intended to transfer some of Amedisys' assets, including home health centers and Optum's locations, to VitalCaring, a provider of home health services. However, complications arose due to a recent court ruling concerning VitalCaring's business practices. The court mandated 43% of VitalCaring’s future profits to be allocated to Encompass Health Corporation EHC and Enhabit, Inc. EHAB. These two companies were involved in a lawsuit alleging unethical practices in VitalCaring’s formation.
This was later followed by UNH terminating the sale agreement with VitalCaring earlier this year. UNH and AMED are now expected to identify new buyers for the divestment assets by March 2025, per reports. Also, the assets in the divesture package are expected to change.
Despite these challenges, the companies are still working to complete the merger, which was previously expected to close by the end of 2024. The new target deadline for closing the deal has been extended to either 10 days following a final court decision on the antitrust lawsuitor by the end of this year, whichever occurs first.
UNH’s Price Performance & Zacks Rank
UnitedHealth shares have declined 2.6% in the past year compared with the industry’s 7.4% fall. It currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
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UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report
Amedisys, Inc. (AMED) : Free Stock Analysis Report
Encompass Health Corporation (EHC) : Free Stock Analysis Report
Enhabit, Inc. (EHAB) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

UnitedHealth's $3.3B Merger Stalls as VitalCaring Sale Falls Through

Amedisys’ AMED growth in the third quarter of 2024 was driven by its continuously improving clinical quality for patients, demonstrated through high Quality of Patient Care and Patient Satisfaction star ratings. The company’s anticipated merger with UnitedHealth Group’s Optum is expected to generate significant synergies. However, a dull macroeconomic scenario and fierce competitive pressure may restrict Amedisys’ growth potential.
In the past year, this Zacks Rank #3 (Hold) company’s shares have lost 4.3% against the industry’s 9.6% growth and the S&P 500 composite’s 25.8% increase.
The leading home health and hospice services provider has a market capitalization of $2.95 billion. Amedisys has an earnings yield of 4.9%, much higher than the industry’s 4.1%.
Tailwinds for AMED Stock
Selloff Decision, A Strategic Pact: In June 2023, Amedisys announced that it received an unsolicited proposal from UnitedHealth Group’s Optum — a diversified health services company — to acquire all of the outstanding shares of Amedisys’ common stock in an all-cash transaction for $101 per share. Combining Optum's extensive value-based care knowledge with Amedisys' dedication to quality and care innovation in the home and its employees' patient-first culture can significantly enhance the health outcomes and experiences of more patients at lower costs, resulting in continuous growth.
Efforts to Improve Clinical Quality: Amedisys’ focus on clinical distinction is demonstrated through its Quality of Patient Care and Patient Satisfaction star ratings. In the Centers for Medicare and Medicaid Services’ reports for the October 2024 Final release, the Quality of Patient Care star average across all Amedisys providers was 4.24, with 89% of its care centers at 4+ Stars and 56% at 4.5+ Stars. Amedisys’ Patient Satisfaction star average for the October 2024 release was 3.78, outperforming the industry. The company aims to achieve a 4.0 Quality of Patient Care star rating for all its care centers. It has implemented targeted action plans to continue to improve the quality of care for patients and further its culture of quality.
Headwinds for AMED Stock
Macroeconomic Pressure on Business Operations: With escalating conflicts in the Middle East, Ukraine and other geopolitical tensions creating volatility in the global financial markets, these issues are likely to cause severe disruptions in the global supply chain and energy markets.
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Furthermore, inflation has increased steadily throughout the United States. Amedisys anticipates these pressures to persist throughout 2024. As a recent example, the company reported a $43.3 million increase in general and administrative expenses in the third quarter of 2024. This was largely due to planned wage increases, higher health insurance costs, and increased legal and IT-related expenditures.
Competitive Landscape: The market for home health and hospice is fragmented with several small local providers. With a few barriers to entry in this market, Amedisys primarily faces tough competition from local privately and publicly-owned, and hospital-owned healthcare providers. It competes based on the availability of personnel, the quality of services, the expertise of visiting staff and the price of services.
Amedisys’ Estimates Trend
The Zacks Consensus Estimate for 2024 earnings per share has moved south 1.8% to $4.45 in the past 30 days.
The Zacks Consensus Estimate for 2024 revenues is pegged at $2.35 billion, indicating a 5% rise from the year-ago reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Omnicell OMCL, Penumbra PEN and ResMed RMD.
Omnicell has an earnings yield of 3.7% compared to the industry’s 9.5%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 121.74%. OMCL’s shares have risen 3.6% compared with the industry’s 19.9% growth in the past year.
OMCL carries a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Penumbra, carrying a Zacks Rank #2 (Buy) at present, has an estimated 2024 earnings growth rate of 33.5% compared with the industry’s 15.9%. Shares of Penumbra have risen 3.2% compared with the industry’s 14.5% growth in the past year. PEN’s earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 10.54%.
ResMed, carrying a Zacks Rank #2 at present, has an estimated earnings growth rate of 8.9% for fiscal 2025. Its shares have surged 115.8% compared with the industry’s 32.2% growth in the past year. RMD’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.41%.
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Amedisys, Inc. (AMED) : Free Stock Analysis Report
Omnicell, Inc. (OMCL) : Free Stock Analysis Report
ResMed Inc. (RMD) : Free Stock Analysis Report
Penumbra, Inc. (PEN) : Free Stock Analysis Report
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reasons to Retain AMED Stock in Your Portfolio Now

The S&P 500 Index ($SPX) (SPY) Friday closed down -1.11%, the Dow Jones Industrials Index ($DOWI) (DIA) closed down -0.77% and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -1.36%. March E-mini S&P futures (ESH25) are down -1.08%, and March E-mini Nasdaq futures (NQH25) are down -1.30%.
Stocks on Friday settled moderately lower, weighed down by a selloff in the Magnificent Seven technology stocks. Also, higher T-note yields on Friday undercut equity prices. Low volumes and thin trading conditions due to holiday trading this week and next are leading to exaggerated moves in stocks.
The US Nov trade deficit widened to -$102.9 billion from -$98.3 billion in Oct, a larger deficit than expectations of -$101.2 billion, a negative development for Q4 GDP and bearish for stocks.
US Nov wholesale inventories unexpectedly fell -0.2% m/m versus expectations of a +0.1% m/m increase. Nov retail inventories rose +0.3% m/m, which is right on expectations.
Strength in Asian equity markets was supportive of US stocks. China’s Shanghai Composite Stock Index rose to a 2-week high Friday on the prospects of additional stimulus to bolster its economy. Japan’s Nikkei Stock index rallied to a 5-1/4 month high, led by strength in exporters as the yen weakened to a 5-month low against the dollar. Also, better-than-expected economic news on retail sales and industrial production boosted Japanese stocks.
The markets are discounting the chances at 11% for a -25 bp rate cut at the January 28-29 FOMC meeting.
Overseas stock markets on Friday settled higher. The Euro Stoxx 50 rose to a 1-week high and closed up +0.84%. China’s Shanghai Composite Index climbed to a 2-week high and closed up +0.06%. Japan’s Nikkei Stock 225 rallied to a 5-1/4 month high and closed up +1.80%.
Interest Rates
March 10-year T-notes (ZNH25) Friday closed down -7 ticks. The 10-year T-note yield rose +3.4 bp to 4.617%. Mar T-notes Friday posted moderate losses but held above Thursday’s 7-month low. Carryover pressure from weakness in European and Japanese government bonds weighed on T-note prices. 10-year German bunds fell to a 1-1/4 month low, 10-year UK Gilts fell to a 1-week low, and 10-year Japanese JGB bonds dropped to a 13-year low. T-notes are also being undercut on the concern that President-elect Trump’s policy agenda may spark growth and inflation and potentially worsen the US fiscal backdrop. T-notes recovered from their worst levels after a slump in stocks boosted safe-haven demand for government debt.
European government bond yields on Friday moved higher. The 10-year German bund yield climbed to a 1-1/4 month high of 2.403% and finished up +7.3 bp to 2.396%. The 10-year UK gilt yield rose to a 1-week high of 4.645% and finished up +5.8 bp to 4.633%.
Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at its January 30 policy meeting and at 12% for a -50 bp rate cut at that meeting.
US Stock Movers
Mega-cap technology stocks retreated on Friday and weighed on the broader market. Tesla (TSLA) closed down more than -4% to lead losers in the Nasdaq 100. Also, Nvidia (NVDA) closed down more than -2% to lead losers in the Dow Jones Industrials. In addition, Microsoft (MSFT), Amazon.com (AMZN), Alphabet (GOOGL), and Apple (AAPL) closed down more than -1%.
Cruise line operators moved lower Friday, with Norwegian Cruise Line Holdings (NCLH), Carnival (CCL), and Royal Caribbean Cruises Ltd (RCL) closing down more than -2%.
Netflix (NFLX) closed down more than -2% on less-than-favorable reviews for the company’s new “Squid Game Season 2” released Thursday.
Crowdstrike Holdings (CRWD) closed down more than -2% on signs of insider selling after an SEC filing showed CEO Kurtz sold $6.5 million of shares on Monday.
Broadcom (AVGO) closed down more than -2% on signs of insider selling after an SEC filing showed CFO Spears sold $2.89 million shares last Friday.
KKR & Co (KKR) closed down more than -1% after the Fly reported the company, along with Bain Capital, each offered over $5 billion for Japan’s Seven & I’s non-core assets.
Fastenal (FAST) closed down more than -2% after announcing that CFO Lweis will resign in April.
Lamb Weston Holdings (LW) closed up more than +2% to lead gainers in the S&P 500 after an amended 13D regulatory filing showed Jana Partners LLC reported a holding in the company.
Defensive food-producing stocks rose on Friday due to weakness in the broader market. Hershey Co (HSY), Hormel Foods (HRL), Mondelez International (MDLZ), Kraft Heinz (KHC), Conagra Brands (CAG), and General Mills (GIS) closed up more than +0.3%.
Progyny (PGNY) closed up more than +15% on signs of insider buying after an SEC filing showed Executive Chairman Schlanger bought $2.2 million shares on Thursday.
Amedisys (AMED) closed up more than +4% after the company and UnitedHealth Group gave themselves more time for UnitedHealth Group to complete the $3.3 billion deal to purchase the company.
VeriSign (VRSN) closed up +0.6% after an SEC filing showed Warren Buffet’s Berkshire Hathaway bought $28.5 million of the stock in the three sessions to Tuesday.
Earnings Reports (12/30/2024)
Gencor Industries Inc (GENC) and Renovaro Inc (RENB).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. More news from Barchart
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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