Amedisys, Inc. (NASDAQ:AMED)

CAPS Rating: 3 out of 5

The Company is a multi-state provider of home health and hospice services.


Player Avatar TMFUltraLong (99.95) Submitted: 7/18/2010 1:58:22 AM : Outperform Start Price: $20.17 AMED Score: -56.26

Wow, that only took about a month to completely knock polly off her perch huh? Amedisys has never been a company particularly high up on my buy list largely because home health care companies are prone to litigation and their business is predominantly mid single digit growth, not enough to attract me. But what has happened with Amedisys over the last month is indeed enough to attract me to place a limit buy order at $22.12! Amedisys is a profit producing cow that will crank out anywhere from $3.75 to $5.00 based in yearly EPS based on economic trends and litigation costs. They are net debt positive about 120M, something I usually am against, but when a company is trading at a lowered forward price to earning of about 5.7, I'm not going to complain all that much. Trading below book value now and beginning to see some nibbling on the insider end I think we're going to find out just how overblown traders have been taking this down over 50% on a 20-30 cent EPS shave for the year and a relatively benign subpoena from the SEC. I really don't know what the hell investors are thinking here but at a 5% growth rate the PEG ratio is right in line if not below the industry average and they are healthfully profitable. And the problem is...?


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