Amedisys, Inc. AMED reported fourth-quarter 2024 adjusted earnings per share (EPS) of 96 cents, which rose 2.1% year over year. However, the metric missed the Zacks Consensus Estimate by 8.6%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

The quarter’s adjustments include certain merger-related expenses and other (income)/expenses, net.

GAAP loss was 62 cents per share against EPS of 59 cents in the corresponding period of 2023.

Full-year 2024 adjusted EPS was $4.32, up 0.5% year over year. 

Following the earnings announcement, AMED’s shares gained 0.1% last Thursday. 

AMED’s Revenues

Net service revenues totaled $598.0 million, up 4.8% year over year. The top line missed the Zacks Consensus Estimate marginally by 0.02%.

Full-year 2024 net service revenues were $2.35 billion, up 4.9% year over year. 

AMED’s Q4 Segmental Performance

Net service revenues from the Home Health division totaled $377.0 million, up 5% year over year.

Within the segment, Medicare revenues of $212.4 million decreased 3.9% year over year. Non-Medicare revenues improved 19.4% year over year to $164.6 million.

Within the Hospice division, net service revenues were $212.9 million (up 3.3% year over year), including Medicare revenues of $202.4 million (up 4.2%) and non-Medicare revenues of $10.5 million (down 11%).

The High Acuity Care segment reported net service revenues of $8.1 million compared with $5.9 million in the year-ago quarter. The Corporate segment did not register recognizable revenues in the fourth quarter.

Margins

The company's gross profit climbed 1.6% to $253.4 million in the quarter under review. However, the gross margin fell 131 basis points (bps) to 42.4% due to a 7.2% increase in the cost of services (including depreciation).

SG&A expenses on salaries and benefits rose 1.9% to $137.6 million. Other expenses rose 1.0% to $58 million. The adjusted operating profit amounted to $57.8 million, up 1.7% from the year-ago level. The adjusted operating margin contracted 29 bps to 9.7% from the prior-year figure.

AMED’s Q4 Liquidity and Cash Position

Amedisys exited 2024 with cash and cash equivalents of $303.2 million compared with $126.4 million at the end of 2023. The company's long-term obligations (excluding the current portion) totaled $339.3 million at the end of 2024 compared with $361.9 million at the end of 2023.

Cumulative net cash provided by operating activities at the end of the fourth quarter was $221.7 million compared with $137.2 million a year ago.

Developments on the Pending Merger

Amedisys’ impending merger with UnitedHealth Group’s Optum, announced in June 2023, brings together two organizations dedicated to providing compassionate, value-based, comprehensive care to patients and their families. 

Amedisys, Inc. Price, Consensus and EPS Surprise

Amedisys, Inc. price-consensus-eps-surprise-chart | Amedisys, Inc. Quote

On June 28, 2024, Amedisys, UnitedHealth Group and certain of their respective subsidiaries entered into a purchase agreement relating to the sale of certain Amedisys home health care centers and UnitedHealth Group care centers to VCG Luna, LLC, an affiliate of VitalCaring. The divestiture is subject to several conditions, including the successful closing of the merger. 

Our Take

Amedisys ended the fourth quarter of 2024 with lower-than-expected results, wherein both earnings and revenues missed estimates. Home Health service revenues benefited from total volume growth and per-visit rate increases. The Hospice segment’s growth was supported by an increase in reimbursement (effective Oct. 1, 2023) and a slight increase in the average daily census. The High Acuity Care segment achieved its highest total admissions volume since inception. 

However, the cost of services in the Hospice and Home Health segments rose mainly due to planned wage increases, wage inflation, investments in hospice clinical staffing and an increase in health insurance costs.

On the flip side, the contraction of both margins in the quarter does not bode well for the stock. On a positive note, the company’s top and bottom lines surged in the quarter. 

AMED’s Zacks Rank & Key Picks

AMED currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader medical space are ResMed RMD, Cardinal Health CAH and Insulet PODD.

ResMed reported a second-quarter fiscal 2025 adjusted EPS of $2.43, which topped the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%. RMD carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.

Cardinal Health, carrying a Zacks Rank #2 at present, posted a second-quarter fiscal 2025 adjusted EPS of $1.93, which outpaced the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.

CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.

Insulet, presently carrying a Zacks Rank #2, posted a fourth-quarter 2024 adjusted EPS of $1.15, which topped the Zacks Consensus Estimate by 9.5%. Revenues of $597.5 million exceeded the Zacks Consensus Estimate by 2.7%.

PODD has an estimated long-term earnings growth rate of 20.3% compared with the industry’s 15.5%. Its earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 27.5%.

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