On Mar 23, 2013, Zacks Investment Research downgraded
Gentiva Health Services Inc.
) to a Zacks Rank #5 (Strong Sell).
Why the Downgrade?
Gentiva has witnessed a downturn in estimates since reporting
its fourth-quarter earnings. The Zacks Consensus Estimate for
2013 has declined almost 28% since the company's earning
On Feb 7, 2013, Gentiva reported fourth-quarter 2012 operating
earnings of 31 cents per share, which lagged the Zacks Consensus
Estimate of 35 cents as well as the year-ago quarter level of 37
cents per share.
Gentiva's net revenues declined 5% year over year to $425.0
million, largely due to a significant cut in the home health
Medicare rates along with the sale and closure of some branches.
It also missed the Zacks Consensus Estimate of $433.0
Further, the company's guidance for 2013 is significantly
lower than the 2012 level due to the impact of sequestration and
changes in Medicare rates. On Mar 20, 2013, Gentiva revealed that
it expects adjusted income from continuing operations between 90
cents and $1.10 per share, substantially lower than the Zacks
Consensus Estimate of $1.29 at that time.
The lower-than-expected guidance led to a downward revision in
estimates by all the analysts covering the stock. As a result,
the Zacks Consensus Estimate declined as well. Currently, the
Zacks Consensus Estimate for 2013 stands at $1.01, down nearly
18% year over year.
Other Stocks to Consider
Not all healthcare companies are performing as poorly as
Gentiva. Some healthcare stocks with favorable Zacks Rank are
Addus HomeCare Corporation
) - Zacks Rank #1 (Strong Buy),
) - Zacks Rank #2 (Buy) and
Coventry Health Care Inc.
) - Zacks Rank #2 (Buy).
ADDUS HOMECARE (ADUS): Free Stock Analysis
COVENTRY HLTHCR (CVH): Free Stock Analysis
GENTIVA HEALTH (GTIV): Free Stock Analysis
LCA-VISION INC (LCAV): Free Stock Analysis
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