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Why Is Mednax (MD) Down 5.3% Since Last Earnings Report?
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It has been about a month since the last earnings report for Mednax (MD - Free Report) . Shares have lost about 5.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Mednax due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
MEDNAX reported second-quarter 2020 adjusted earnings of 32 cents per share, beating the Zacks Consensus Estimate by 113.3%. However, the bottom line plunged 64% year over year due to muted revenues.
The company’s results were negatively impacted by the COVID-19 pandemic. In fact, the coronavirus outbreak dented patient volumes as well as revenues. The impact on net revenues was maximum during April.
Quarterly Details
The company generated revenues of $509 million, which missed the Zacks Consensus Estimate by 13.9%. Also, the top line declined 41.4% from the year-ago period. This was due to major reductions in patient volumes as a result of the prevalent COVID-19 pandemic.
Same unit revenues dropped 11.7% year over year.
General and administrative expenses fell 7.7% to $77.7 million on the back of lower general and administrative expenses.
Interest expense of the company declined 9% to $28.3 million on the back of lower borrowings.
In the quarter under review, EBITDA totaled $65.2 million, down 30.8% year over year.
Financial Update
As of Jun 30, 2020, the company had cash and cash equivalents of $132.2 million, up 22.5% from the level as of Dec 31, 2019.
The company’s total debt of $1.7 billion was up 0.5% from the level at 2019 end while total assets worth $3.4 billion were down 18.3% from the level at last-year end.
Cash flow generated from operating activities was $193.4 million in the quarter under review, jumping 172% year over year.
Business Update
MEDNAX completed the sale of its anesthesiology medical group American Anesthesiology to North American Partners in Anesthesia (NAPA).
The company intends to divest MEDNAX Radiology Solutions and return to its original name, Pediatrix Medical Group, Inc. It aims to channelize its resources as a pediatrics and obstetrics organization.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month. The consensus estimate has shifted -8.57% due to these changes.
VGM Scores
At this time, Mednax has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Mednax has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Mednax (MD) Down 5.3% Since Last Earnings Report?
It has been about a month since the last earnings report for Mednax (MD - Free Report) . Shares have lost about 5.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Mednax due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
MEDNAX's Q2 Earnings Surpass Estimates, Decline Y/Y
MEDNAX reported second-quarter 2020 adjusted earnings of 32 cents per share, beating the Zacks Consensus Estimate by 113.3%. However, the bottom line plunged 64% year over year due to muted revenues.
The company’s results were negatively impacted by the COVID-19 pandemic. In fact, the coronavirus outbreak dented patient volumes as well as revenues. The impact on net revenues was maximum during April.
Quarterly Details
The company generated revenues of $509 million, which missed the Zacks Consensus Estimate by 13.9%. Also, the top line declined 41.4% from the year-ago period. This was due to major reductions in patient volumes as a result of the prevalent COVID-19 pandemic.
Same unit revenues dropped 11.7% year over year.
General and administrative expenses fell 7.7% to $77.7 million on the back of lower general and administrative expenses.
Interest expense of the company declined 9% to $28.3 million on the back of lower borrowings.
In the quarter under review, EBITDA totaled $65.2 million, down 30.8% year over year.
Financial Update
As of Jun 30, 2020, the company had cash and cash equivalents of $132.2 million, up 22.5% from the level as of Dec 31, 2019.
The company’s total debt of $1.7 billion was up 0.5% from the level at 2019 end while total assets worth $3.4 billion were down 18.3% from the level at last-year end.
Cash flow generated from operating activities was $193.4 million in the quarter under review, jumping 172% year over year.
Business Update
MEDNAX completed the sale of its anesthesiology medical group American Anesthesiology to North American Partners in Anesthesia (NAPA).
The company intends to divest MEDNAX Radiology Solutions and return to its original name, Pediatrix Medical Group, Inc. It aims to channelize its resources as a pediatrics and obstetrics organization.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month. The consensus estimate has shifted -8.57% due to these changes.
VGM Scores
At this time, Mednax has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Mednax has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.