Gentiva Beats, Affirms Outlook - Analyst Blog

By Zacks Equity Research,

Shutterstock photo

Gentiva Health Services Inc. ( GTIV ) reported second-quarter 2012 operating net earnings of 35 cents per share, ahead of the Zacks Consensus Estimate of 28 cents but lower than the year-ago quarter level of 47 cents per share. Operating net income of $10.7 million also compares unfavorably with $14.0 million in the year-ago quarter.

Including all one-time charges and income from gains on sales of businesses of $3.25 million or 11 cents per share and expenses related to restructuring, legal settlement and acquisition and integration costs of $0.03 million, Gentiva posted net income of $13.9 million or 46 cents per share, increasing substantially from the prior-year income of $4.5 million or 15 cents per share.

Gentiva's net revenues declined 4.7% year over year to $427.7 million, and also missed the Zacks Consensus Estimate of $435.0 million. The year-over-year decline was largely due to the sale and closure of some branches coupled with a 7.3% decline in the Home Health Episodic segment revenue to $235.7 million, arising from reduced Medicare reimbursement rates. This was followed by a marginal year-over-year decline of 1.2% related to the Hospice segment revenue of $192.0 million.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) attributable to continuing operations decreased 6.6% to $48.3 million from $51.7 million in the prior-year quarter.

Financial Update

Gentiva exited the quarter with cash and cash equivalents of approximately $155.3 million down from $164.9 million as of December 31, 2011. Long-term debt was $922.7 million, down from $973.2 million at 2011 end.

During the reported quarter, net cash from operating activities amounted to $83.8 million versus $17.2 million in the prior-year period. Free cash flow also improved considerably to $80.7 million from $11.8 million in the second-quarter of 2011, primarily due to fall in company's day sales outstanding and better operating results.

As of June 30, 2012, Gentiva had total assets of $1.48 billion and shareholders' equity of $220.3 million, as compared with $1.53 billion and $202.5 million, respectively, as of December 31, 2011.


Gentiva received $5.9 million as proceeds from the sale of branches in Louisiana -- eight home health branches and four hospice branches. This was with respect to an asset purchase agreement worth $6.4 million. About $0.5 million remains unpaid.

Outlook for Fiscal 2012

Gentiva affirmed its net revenue guidance at $1.70-1.76 billion and adjusted income from continuing operations guidance at $1.00-1.20 per share. 

Zacks Rank

Gentiva carries a Zacks #3 Rank, which translates into a short-term Hold rating. Amedisys Inc. ( AMED ) also shares the same Zacks #3 Rank with Gentiva, and is expected to release its second-quarter 2012 earnings before the market opens on August 7, 2012. According to the Zacks Consensus Estimate, Amedisys is expected to report operating earnings of 25 cents a share, falling 62.7% from its prior-year quarter earnings.

AMEDISYS INC (AMED): Free Stock Analysis Report
GENTIVA HEALTH (GTIV): Free Stock Analysis Report
To read this article on click here.
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.

This article appears in: Investing , Business , Stocks
Referenced Stocks: AMED , GTIV

More from


Follow on:

Find a Credit Card

Select a credit card product by:
Select an offer:
Data Provided by