AmSurg Surging

Originally Published In the News April 23 2008 11:10 AM
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Watching the shares of AmSurg (AMSG-NASDAQ) trade is usually about as fun as watching paint dry, but today the stock is lifting despite a fairly uneventful earnigs release:

AmSurg reported first quarter 2008 results, which were in-line iwth expectations. EPS rose about 12% YTY, to 37 cents. Net patient revenue registered at $147.4 million, up about 18% from the year ago period (after adjusting for center dispositions) and slightly above the $146.7 million consensus target.

As expected, strong acquisition and development activity accounted for the majority of growth, as same facility revenue increase only 3% during the quarter (at the low end of management’s guidance). We estimate that recently lowered Medicare reimbursement rates (which took effect January 1, 2008) negatively affected same-facility sales growth by approximately 100 basis points; the timing of Easter, (shifting into first quarter 2007) also hurt organic growth by an estimated 100 basis points. As the phase-in of these lower Medicare rates span four years, we expect similar same facility growth pressure to continue for the intermediate future.

William Blair Research Note

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