The Ensign Group (NASDAQ: ENSG), is a provider of skilled nursing and rehabilitative care services, is a stock which should fare well through this recession/ depression and beyond. This is a stock that will benefit from our aging society here in the U.S. Based on demographic studies by the likes of Harry Dent Jr., the baby boom generation has already started to retire and the pace at which they will be retiring will accelerate in the coming years and so will the demand for nursing and rehab care services as the baby boom generation ages.
The Ensign Group operates facilities located in California , Arizona , Texas, Washington , Utah and Idaho . As of December 31, 2008, the company owned or leased 65 facilities. The facilities provide a broad spectrum of skilled nursing; physical, occupational and speech therapies. The facilities have a collective capacity of more than 7,400 skilled nursing, assisted living and independent living beds.
While most of corporate America is seeing a dramatic shrinking of earnings, ENSG is proving to be the exception to the rule. It is using some of its cash to acquire nursing care companies, thus increasing its dividend. Regardless of the economy or who the president might be, there will be a need to care for the elderly so long as this demographic group continues to soar, which it will.
ENSG is projected to grow its earnings more than 15% in the next five years, and is one of the few stocks that finished 2008 higher than it started. Take advantage of the general market volatility to help buy some ENSG at lower levels. I would stick with this one through the market’s ups and downs, it should be a long-term winner. ENSG has large upside potential.
The stock is currently trading at $14.55 and is right on its 200 day moving average which is up slopping this is an attractive entry point. The stock however is down 23% since 2/9/09 and is in downtrend so it does not look good technically. So another option for entry could be to let the downtrend play out and buy it on a move above a pivot point, currently that point is at 15.80.
Note: I do not own ENSG
