HLS

Healthsouth Corp

Healthcare


Presented:02/03/2016
Price:$35.77
Cap:$3.63B
Current Price:$96.33
Cap:$9.82B

Presented

Date02/03/2016
Price$35.77
Market Cap$3.63B
Ent Value$6.13B
P/E Ratio19.74x
Book Value$6.89
Div Yield2.57%
Shares O/S101.50M
Ave Daily Vol597,107
Short Int6.60%

Current

Price$96.33
Market Cap$9.82B
HealthSouth Corp. owns and operates inpatient rehabilitation hospitals. It serves patients through its network of inpatient rehabilitation hospitals, outpatient rehabilitation satellite clinics and home health agencies. HealthSouth's hospitals provides rehabilitative care to patients who are recovering from conditions such as stroke and other neurological disorders, cardiac and pulmonary conditions, brain and spinal cord injuries, complex orthopedic conditions, and amputations. The company was founded by Richard M. Scrushy on February 22, 1984 and is headquartered in Birmingham, AL.

Publicly traded companies mentioned herein: HealthSouth Corp (HLS)

Highlights

Shares of HealthSouth (HLS) are attractively valued at ~$35 and the risk/ reward appears to be favorable. The $3.25 billion market cap post-acute care operator (specializing in inpatient rehabilitation, which accounts for 90% of revenue) is underfollowed by the Street (just six analysts cover the company) and should grow EBITDA ahead of estimates in 2016 and 2017. A few issues caused 2015 EBITDA to come in lower than expected by $15 - $20 million, and both Street estimates and management guidance now appear to be conservative. Using an average multiple to EBITDA (8.25x) suggests shares could trade up to the high $40s over the next 12-18 months.

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Idea Discussion

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