Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

HMS Holdings (HMSY) Q2 Earnings And Revenues Top Estimates

Published 08/04/2019, 10:06 PM
Updated 07/09/2023, 06:31 AM
US500
-
ISRG
-
BAX
-
SYK
-
HMSY
-

HMS Holdings Corp. (NASDAQ:HMSY) reported adjusted earnings of 34 cents per share in second-quarter 2019, which surpassed the Zacks Consensus Estimate of 26 cents by 30.8%. The bottom line also surged 36% from the year-ago quarter.

Revenues totaled $168.2 million, which beat the Zacks Consensus Estimate by 5.5%. Moreover, the top line improved 14.6% on a year-over-year basis.

Q2 Segmental Analysis by Product

Analytical Services

Revenues at this segment were $63.1 million in the second quarter, up 37.2% year over year.

Within Analytical Services, PI revenues (excluding Medicare RAC) amounted to $38.6 million, up 23.7% year over year.

PHM revenues totaled $14 million in the quarter under review, down 5.4% on a year-over-year basis.

COB

Revenues at the COB segment grossed $105.1 million in the second quarter, up 4.3% year over year.

HMS Holdings Corp Price, Consensus and EPS Surprise

HMS Holdings Corp Price, Consensus and EPS Surprise

HMS Holdings Corp price-consensus-eps-surprise-chart | HMS Holdings Corp Quote

Margin Analysis

Total cost of services in the reported quarter was $99.6 million, down 1.4% year over year.

Gross profit came in at $68.6 million, which surged 49.9% from the prior-year quarter figure. Gross margin was 40.8% of net revenues, up 960 bps year over year.

Selling, general and administrative expenses totaled $28 million, up 5.7% year over year. Operating income in the second quarter was $40.5 million, against operating loss of $0.8 million in the year-ago quarter.

Financial Update

Cash and cash equivalents amounted to $268.7 million, up 50.1% from the year-end 2018.

Net cash provided by operating activities for the six months ended Jun 30, 2019, came in at $78.1 million, compared with $23.7 million from the year-ago quarter.

Guidance Raised

For 2019, the company now anticipates revenues between $650 million and $660 million (up from the previously guided range of $640-$650 million). This depicts year-over-year growth in the band of 8.6-10.3%. The mid-point of $655 million is above the Zacks Consensus Estimate of $646.9 million.

Net income is expected in the band of $85-$90 million (up from the prior band of $64-$70 million), indicating growth in the range of 54.5-63.6% year over year.

Adjusted EBITDA is expected in the range of $185-$190 million (up from the previously guided range of $170-$175 million), suggesting improvement of 14-17%.

Summing Up

HMS Holdings ended the second quarter of 2019 on a solid note, beating the Zacks Consensus Estimate on both counts. The stock continues to benefit from Analytical Services and COB units. Additionally, gross margin expansion is a positive. Raised 2019 outlook also buoys optimism for the stock.

However, cut throat competition in the U.S. medical cost containment space remains a concern.

Zacks Rank

Currently, HMS Holdings carries a Zacks Rank #3 (Hold).

Earnings of Other MedTech Majors at a Glance

Some better-ranked stocks which reported solid results this earning season are Stryker Corporation (NYSE:SYK) , Baxter International Inc. (NYSE:BAX) and Intuitive Surgical, Inc. (NASDAQ:ISRG) .

Stryker delivered second-quarter 2019 adjusted earnings per share of $1.98, beating the Zacks Consensus Estimate by 2.6%. Revenues of $3.65 billion surpassed the Zacks Consensus Estimate by 1.4%. The company carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Baxter delivered second-quarter 2019 adjusted earnings of 89 cents per share, which surpassed the Zacks Consensus Estimate of 81 cents by 9.9%. Revenues of $2.84 billion outpaced the Zacks Consensus Estimate of $2.79 billion by 1.9%. The company carries a Zacks Rank #2.

Intuitive Surgical reported second-quarter 2019 adjusted earnings per share of $3.25, which beat the Zacks Consensus Estimate of $2.85. Revenues were $1.1 billion, surpassing the Zacks Consensus Estimate of $1.03 billion. The company sports a Zacks Rank #1.

Today's Best Stocks from Zacks

Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.

This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.

See their latest picks free >>



HMS Holdings Corp (HMSY): Free Stock Analysis Report

Intuitive Surgical, Inc. (ISRG): Free Stock Analysis Report

Baxter International Inc. (BAX): Free Stock Analysis Report

Stryker Corporation (SYK): Free Stock Analysis Report

Original post

Zacks Investment Research

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.