In this type of a market it is easy to forget that not every stock is going
down. Other than Novartis (NYSE:NVS), there is another "Oxford Club Stock" that
their Associate Investment Director Lou Basenese recommends that has had quite a
run.
Here's how Lou wrote about it and I share this with you because Lou gave me
permission to do so (www.OxfordClub.com).
"Simply buy Amedisys Inc. (Nasdaq: AMED). Recall, the company is one of
the nation’s leading home health care companies. It has more than 8,000
caregivers, working from more than 350 home health centers and hospice agencies,
across more than 30 states.
And business is booming (pun intended). In the most recent quarter,
revenues and earnings leapt 85% and 44%, respectively, smashing even the most
aggressive analyst expectations.
Of course, the company’s not serving the Baby Boomer generation yet,
either. But it will soon. And that means this already $63 billion market is
bound to get bigger still.
Here’s why...We all know over the next few decades, fewer workers will be
supporting more and more senior citizens. In anticipation of this increasing and
imminent liability, the health care industry’s already being pressured to rein
in soaring costs.
Enter Amedisys, Medicare’s dream. While it costs approximately $1,000 per
day to keep a patient in the hospital for rehabilitation, Amedisys can provide
the same services at the patient’s home for less than $80 per day. It’s no
wonder Medicare accounts for almost 90% of the company’s business.
But Medicare’s not the only beneficiary. With home health care, patients
also fare better. For one, they get to stay in the friendly and comfortable
confines of home. They also get to avoid the high rate of infections associated
with prolonged hospital and nursing home stays.
Naturally, there are other home health care stocks capitalizing on these
same industry trends. But we’re convinced Amedisys represents the best
investment.
Here’s why…
The company continues to grow both organically and through acquisitions.
In fact, it was Amedisys’ $395 million acquisition of TLC Health Care Services
in March that helped it perform so well in the recent quarter. And the
fragmented nature of the industry, with more than 8,500 agencies, ensures
Amedisys will have the opportunity to get even more earnings “booster shots” via
timely acquisitions.
Then there is the company’s high-tech business model. By handling all
documentation and billing electronically, Amedisys realizes 32% higher net
margins than the rest of the industry.
Lastly, institutions love the stock. They own almost all of the
outstanding shares. And they keep buying. In the last quarter, they upped their
stake by another 1%. This last factor, combined with top-notch fundamentals, is
helping Amedisys become a rare breed – a momentum stock in a bear market.
The stock hit three new 52-week highs in the last month, already. And
that’s a trend worth embracing, not fighting. So keep buying." Now that is
an impressive company and an impressive story