Amedisys, Inc. :AMED-US: Earnings Analysis: Q1, 2017 By the Numbers : June 6, 2017

Amedisys, Inc. reports financial results for the quarter ended March 31, 2017.

We analyze the earnings along side the following peers of Amedisys, Inc. – LHC Group, Inc., Almost Family, Inc., Chemed Corporation, BioScrip, Inc. and National HealthCare Corporation (LHCG-US, AFAM-US, CHE-US, BIOS-US and NHC-US) that have also reported for this period.


  • Summary numbers: Revenues of USD 370.46 million, Net Earnings of USD 15.13 million.
  • Gross margins narrowed from 40.85% to 40.56% compared to the same period last year, operating (EBITDA) margins now 7.99% from 4.45%.
  • Year-on-year change in operating cash flow of 121.31% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • Earnings growth from operating margin improvements as well as one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2017-03-31 2016-12-31 2016-09-30 2016-06-30 2016-03-31
Relevant Numbers (Quarterly)
Revenues (mil) 370.46 366.3 361.6 360.75 348.82
Revenue Growth (%YOY) 6.2 8.25 10.77 14.83 15.67
Earnings (mil) 15.13 8.92 11.44 10.7 6.21
Earnings Growth (%YOY) 143.52 -30.93 35.49 0.55 117.75
Net Margin (%) 4.08 2.43 3.16 2.96 1.78
EPS 0.44 0.26 0.34 0.32 0.19
Return on Equity (%) 12.82 7.86 10.46 10.2 6.05
Return on Assets (%) 8.12 4.9 6.38 6.04 3.57

Access our Ratings and Scores for Amedisys, Inc.

Market Share Versus Profits

Revenues History
Earnings History

AMED-US‘s change in revenue this period compared to the same period last year of 6.20% is almost the same as its change in earnings, and is about average among the announced results thus far in its peer group, suggesting that AMED-US is holding onto its market share. Also, for comparison purposes, revenues changed by 1.14% and earnings by 69.68% compared to the immediate last period.

Revenues Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Leader, Earnings Focus, Laggard, Revenues Focus

Earnings Growth Analysis

The company’s gross margins showed no year-on-year improvement. In spite of this, the company’s earnings rose, influenced primarily by the improvement in operating margins (EBITDA margins) from 4.45% to 7.99%. For comparison, gross margins were 40.59% and EBITDA margins were 6.28% in the last period.

Gross Margin Versus EBITDA Margin

Quadrant label definitions. Hover to know more

Differentiated; Low Cost, Commodity; Low Cost, Commodity; High Cost, Differentiated; High Cost

Gross Margin Trend

Companies sometimes sacrifice improvements in revenues and margins in order to extend friendlier terms to customers and vendors. Capital Cube probes for such activity by comparing the changes in gross margins with any changes in working capital. If the gross margins improved without a worsening of working capital, it is possible that the company’s performance is a result of truly delivering in the marketplace and not simply an accounting prop-up using the balance sheet.

Gross Margin History
Working Capital Days History

AMED-US‘s decline in gross margins has not produced any significant offsetting improvement in its working capital . This leads Capital Cube to conclude that the decline in gross margins are likely from operating issues and not trade-offs with the balance sheet. Working capital days are currently 11.39 days, compared to last year’s level of -3.07 days.

Gross Margin Versus Working Capital Days

Quadrant label definitions. Hover to know more

Customer Financed, Cash Starved, Supplier Financed, Cash Rich

Cash Versus Earnings – Sustainable Performance?

It is important to examine a company�s cash versus earnings numbers to gauge whether its performance is sustainable.

AMED-US‘s change in operating cash flow of 121.31% compared to the same period last year is about the same as its change in earnings this period. Additionally, this change in operating cash flow is about average among its peer group. This suggests that the company did not use accruals or reserves to manage earnings this period, and that, all else being equal, the earnings number is sustainable.

Operating Cash Flow Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Cash Flow based Earnings, Likely Non-cash Earnings, Low Cash Flow Base, Likely Undeclared Earnings


The company’s earnings growth has also been influenced by the following factors: (1) Improvements in operating (EBIT) margins from 3.17% to 6.79% and (2) one-time items. The company’s pretax margins are now 6.78% compared to 3.07% for the same period last year.

EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables
EBIT Margin History
PreTax Margin History

Access our Ratings and Scores for Amedisys, Inc.

Company Profile

Amedisys, Inc. provides hospice and home health care services to the chronic, co-morbid and aging American population. The company focuses on delivering patient-centered care, whether that is home-based recovery and rehabilitation after an operation or injury, care focused on empowering them to manage a chronic disease, palliative care for those with a terminal illness, or hospice care at the end of life. It operates its business through the following business segments: Home Health and Hospice. The Home Health segment delivers services in the homes of individuals who may be recovering from an illness, injury or surgery. The Hospice segment provides care that is designed to provide comfort and support for those who are facing a terminal illness. Amedisys was founded by William F. Borne in 1982 and is headquartered in Baton Rouge, LA.

CapitalCube does not own any shares in the stocks mentioned and focuses solely on providing unique fundamental research and analysis on approximately 50,000 stocks and ETFs globally. Try any of our analysis, screener or portfolio premium services free for 7 days. To get a quick preview of our services, check out our free quick summary analysis of AMED-US.