Gee, there is somebody else here, thanks for asking:
Earnings were 0.78. The highest expected I had seen was Zacks at .74. It is complicated by the fact that there were non-recurring and extraordinary charges which resulted in a net loss for the quarter. I believe that is why the initial market response was negative. It could be coincidence, but I don't think so, that as the conference call progressed, the stock turned around and stayed up for the day. The conference call was very positive, with analysts several times congratulating the IHS staff on the earnings.
Discussion of the hearings going on this week, Columbia's Medicare fraud charges and effect of investigation into home health care companies came up several times, IHS took the position that it welcomed this look at providers because it has been practicing at a higher standard than some others . . . in their words, "raising the bar" can only benefit them. The ROTC deal was promoted as nothing but good and they hope to have it closed as early as mid Septmeber. Pointed at synergies and the elimination of Rotech's physician practice losses. Expect "cross-selling" of services to increase overall respiratory care demand, offsetting the 25% decline in HCFA payments for same. Projected 185 Mil revenue from ROTC in 97, 200 Mil in 98. Although Kennedy is stepping out, he will be one of the largest IHS stockholders.
I sold my IHS and bought ROTC today to go after the 5-6% discount in the price differential.
I'll go get a copy of the IHS ER and post it. |
