Here's Why You Should Retain AMN Healthcare (AMN) Stock Now
AMN Healthcare Services, Inc. AMN is well poised for growth on the back of a broad range of services, and its Healthcare Managed Services Program (“MSP”). However, stiff competition in the industry remains a concern.
The stock has gained 39.8%, compared with the industry’s growth of 15% over the past three months. Further, the S&P 500 Index rallied 6.9% in the same time frame.
AMN Healthcare — with a market capitalization of $3.15 billion — is a travel healthcare staffing company. It has a trailing four-quarter earnings surprise of 14.4%, on average.
Let’s take a closer look at the factors that substantiate the company’s Zacks Rank #3 (Hold).
What’s Weighing on the Stock?
AMN Healthcare faces significant competition in the industry it operates in. Notably, a large number of providers of healthcare recruiting and internet-based learning and research solutions for training pose stiff competition to the company. This, in turn, is likely to significantly impact its margins.
AMN Healthcare’s unique Healthcare MSP is helping it gain market traction. Notably, the program helps streamline the entire workforce planning process, which facilitates delivery of enhanced patient care. This has resulted in a large network of improved patient care and enhanced efficiency.
Since mid-March, the company has deployed more than 10,000 health care professionals through AMN brands, its MSP and VMS affiliate partners and marketplace technology solutions.
AMN Healthcare’s business has gradually evolved beyond traditional healthcare staffing. Notably, the company has become a strategic workforce solutions partner with its clients. Its service portfolio includes vendor management systems, MSP, predictive labor analytics, workforce optimization technology and consulting, clinical labor scheduling, recruitment process outsourcing, mid-revenue cycle management and credentialing software services.
In June 2020, the company introduced a customizable, technology-enabled and clinically based service for businesses and other organizations that want to ensure health and safety of their employees as they slowly return to workspaces. This new solution is likely to provide a boost to the company’s Technology and Workforce Solutions segment.
Which Way are Estimates Headed?
For 2020, the Zacks Consensus Estimate for revenues is pegged at $2.27 billion, indicating an improvement of 2.1% from the prior year. The same for adjusted earnings per share stands at $3.02, suggesting a decline of 5% from the year-ago reported figure.
Stocks to Consider
Some better-ranked stocks from the broader medical space include DaVita Inc. DVA, Boston Scientific Corporation BSX and Thermo Fisher Scientific Inc. TMO. While Boston Scientific carries a Zacks Rank #2 (Buy), both DaVita and Thermo Fisher sport a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
DaVita has a projected long-term earnings growth rate of 11.9%.
Boston Scientific has an estimated long-term earnings growth rate of 10%.
Thermo Fisher has a projected long-term earnings growth rate of 15.5%.
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With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
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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.