Amedisys, Inc. (NASDAQ:AMED)

Home health care companies got even cheaper this week

My reasons:
-High ROC / Earnings Yield
-Growing owner's earnings
-P/S < 0.5, P/B < 0.5
-Decent financials
-Great potential for growth with the aging population.

This stock is worth at least double what it is now.

Seems a bargain with a p/b ratio of 0.37 for a healthcare company that is in 45 states in the US. EPS have dropped about 41% since last year, but the share price has dropped 64%.

Trading at a PE of 5.3 and less than book value.

http:www.gurufocus.com gives this a "Fair Value" of $129.87

Cheap, low P/E ratio.

value

I am wary that some of their management practices will be landing them in hot water...but maybe I still remember the days of HealthSouth a little too well...

I am a BetterInvesting member and selected this stock with my SSG (www.betterinvesting.org).

Home care is facing a changing regulatory / reimbursement environment. This will negatively affect margins on companies in this space. But the trend to more home care should stay in place, as it is a cheaper alternative to hospital and nursing home care, and one patients embrace. Lumpy time to get in, but one that should pay off in the long term.

MF

Price/earnings of 8.23, market cap of 958.98 million, Debt/equity of 0.21, Return on Invested Capital of 11.20, based in Louisiana, United States, focus on home healthcare.

It is cheap now and well positioned in a growth segment. To the extent management executes on their plan this should be a winner

Story: Amedisys specializes in home healthcare nursing services. I like this as a longtime play as more and more babyboomers become potential customers.

It is the numbers that have me drooling over this company though. With a PEG ratio of only 0.9, price to book ratio of 1.3, price to sales ratio of a measly 0.7, price to cash flow of 5.4 and price to earnings ratio of 8, this stock meets about anyone's definition of a value stock. Those looking for growth won't be disappointed either. The historical revenue growth rate is a robust 40.9%, Earnings per share has grown a nice 41.7% with analysts predicting 13.5% growth in the future. Return on Equity is a solid 16.8%. A nice kicker is that AMED carries little debt with a debt to equity ratio of only 20%.

The only drawback I see is that AMED doesn't pay a dividend. However, there is good options activity for those interested in lowering their effective purchase price by either selling covered calls or writing puts.

I'm jumping in a putting a sizable real money stake in this small cap company. It is my top pick.

Demographics will only help Amedisys going forward. WIth the real benefits from an aging population to be realized 10+ years from now, the best play by any company with a demography play is to expand its presence as much as possible over the next decade, re-invest heavily, and build the infrastructure to become a leading-name player in 2020. AMED focuses on growth, and its wide network will allow it to reap the benefits of a world without enough investment in senior care.

1. SOLR 3*
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4. AMED 2*
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Timestamp: 2010-12-21 03:28:52 UTC

There are lots of old people. Everywhere. And if there’s one thing I know about old people it’s that they hate going outside and they wont if they don’t have to. That’s why I love these home healthcare companies.

Also, looks like these home healthcare companies got a little…um…creative with the way they were keeping their books and working with some fun loopholes in healthcare legislation. So much so that the regulation hammer began to fall and then their stock took a beating. Regulation wont kill the industry so I expect good times ahead for people taking care of old people. A good long term CAPS pick.

Read more at www.batting450.wordpress.com

79,46,50
71,10,20

It will come back

Slow climb retracement towards resistance of $35.05 long term.