The first month of 2022 was not kind to stock values across the board, as the Omicron variant swept across the country. And while home health and post-acute providers didn’t emerge unscathed, they fared considerably better than the S&P according to the latest Home Health (HHI) and Post-Acute Care (PAI) indices from national mergers and acquisitions advisory firm Stoneridge Partners.

“Home health and post-acute providers had a rough go of it in 2021, but stocks started to gain momentum at the end of the year – until Omicron hit,” said Stoneridge Managing Partner Brian Bruenderman. “The new variant really took a toll on providers, with record numbers of staff out of work and in quarantine.”

Yet both the HHI and PAI outperformed the market as a whole, dropping about 5% and 6%, respectively, in January — the S&P dropped close to 15% over that same time period.

Post-Acute Care Index

The number of Encompass Health Corporation (NYSE: EHC) employees with COVID-19 hit an all-time record in January, forcing the provider to turn away even more admissions after already losing 1,700 in the fourth quarter of 2021. Still, Encompass was down just 5% month-over-month. And Barb Jacobsmeyer, who helms Encompass Health’s home health and hospice segment — soon to be Enhabit Home Health & Hospice — says she is very optimistic about the company’s ability to start reining in those lost admissions in February and beyond.

Post-acute care companies are still bullish about the future, particularly as the Omicron wave has started to subside. Moving forward, providers indicate they will focus more on retention of current staff and recruitment of new staff, as opposed to plugging holes for quarantining workers.

Elsewhere in the PAI, Brookdale Senior Living Inc. (NYSE: BKD) performed admirably in January, up by 3%. Meanwhile, The Pennant Group, Inc. struggled, down 40% in January as compared to December.

Home Health Index

In January, Amedisys, Inc. (Nasdaq: AMED) and LHC Group, Inc. (Nasdaq: LHCG) were down by 9% and 13%, respectively.

Amedisys continued on its growth trajectory, announcing an agreement to acquire Evolution Health, a Dallas-based provider of home health, hospice and infusion therapy services. According to analysts, Amedisys paid anywhere from $70 to $75 million for Evolution, suggesting the company was reigniting its home health M&A engine as January came to a close.

LHC Group echoed its peers’ concerns about staffing issues in January, and leaders say mitigating those issues remains a priority.

“Labor pressures and shortages have been so much a focus for the industry, especially over the back half of 2021,” LHC Group President and COO Josh Proffitt told Home Health Care News in January. “I would say, in connection with that, improvements in recruiting and retention will be a main force moving forward. Providers are focused on mitigating those pressures.”

Even with all the difficulties home health providers have faced throughout the pandemic, their year-over-year performance has remained strong; compared to 12 months ago, the HHI is still up more than 21%.

Quote of the Month

“If we can deliver the right behavioral health response at the right time, then patients and their families don’t have to wait for a bad situation to get worse before receiving attention.” – Alyna T. Chien, MD, MS, the research director for the division of general pediatrics at Boston Children’s Hospital and assistant professor of pediatrics at Harvard Medical School.

Read the Full Article Here: Most practices struggle to support kids with behavioral health needs

Articles Featuring Stoneridge

View our quarterly M&A webinars on current valuation trends, deal flow, and pertinent regulatory changes in home health, home care, hospice, ID/DD and behavioral health industries. Visit the Speaker Series Webinar Library on our website.

See It To Believe It!

The Stoneridge Partners Home Health Index (HH Index) is updated monthly and measures the performance of these two publicly traded home health companies, all listed on the NASDAQ:

  • LHC Group (LHCG)
  • Amedisys (AMED)

Here are the results of the stock prices for the past two years:

Company 1/31/22 1 mos change YTD change 1/31/21 1/31/20
Amedisys 135.04 -16.58% -16.58% 289.07 176.49
LHC Group 124.81 -9.05% -9.05% 199.11 145.75
HH Index* 129.93 -13.13% -13.13% 244.09 161.12
S&P 4522.67 -5.11% -5.11% 3731.17 3225.52
Addus 79.74 -14.73% -14.73% 112.67 94.34

Although we track the performance of Addus, they are not included in our HH Index because very little of their revenue comes from Medicare.

Enterprise Value (EV)

EV (in M) 2022 2021 2020
Amedisys 4490 10370 6200
LHC Group 4050 6760 5000
HH Index Total 8540 17130 11200
Addus 1280 1950 1470



Enterprise Value (EV), aka Selling Price, as Percent of Revenue

Company 2022 2021 2020
Amedisys 204% 513% 328%
LHC Group 187% 328% 243%
HH Index Average* 196% 421% 286%
Addus 153% 256% 222%

The Stoneridge Partners Post-Acute Care Index is updated monthly and measures the performance of these six publicly traded post-acute care companies, all listed on the NASDAQ:

  • LHC Group (LHCG)
  • Amedisys (AMED)
  • Addus (ADUS)
  • The Pennant Group, Inc. (PNTG)
  • Encompass Health (EHC)
  • Brookdale Senior Living Inc. (BKD)

This graph displays Post-Acute Care Index performance starting late 2019.

The above calculations are based on selling price being defined as Enterprise Value (EV), with data provided by Capital IQ. Enterprise value is defined as market cap plus debt, minority interest and preferred shares, minus total cash and cash equivalents. EBITDA is calculated using methodology which may differ from that used by a company for its reporting. (Home Health Index February 2022 | Stoneridge Partners)

Exclusively Listed For Sale By Stoneridge Partners.
Do you know of any acquisitions that have taken place? We are interested in your comments. Contact us at Stoneridge Partners.

Hospice agency.  6 counties in northern California.  Moratorium in place.  Minimal census.  Accredited.

 Hospice /  California

Medicare home health agency.  Health system relationship.  Rare KY CON opportunity, multiple counties

 Home Health /  Kentucky

Opportunity to establish a Houston-based hospice.  Low-census provider licensed for regions 3, 4, 5 and 6.

 Hospice /  Texas

Opportunity to establish a Medicare hospice and Medicare home health agency.  Greater Salt Lake city area.  Clean provider number with management and field staff in...

 Home Health /  Utah

Large, established franchise territory.  $2.5 million revenue.  Two offices with strong leadership teams in place.

 Home Care /  Michigan

ABA in-home and community-based autism treatment for children and families.  Located in Northeastern VA.  $1M in revenue.  Completely self-sufficient staff to remain.

 Other /  Virginia

Home health with $8+M in revenue.  Medicare/Medicaid-certified.  90+% traditional Medicare/episodic.  Services central Texas and licensed for entire state.  Strong management team in place.

 Home Health /  Texas

Home care franchisee.  $8.4M in revenue.  Highly profitable agency.  Medicaid/private pay.

 Home Care /  Kentucky

Skilled home health agency.  JCAHO accredited, zero deficiencies.  Excellent reputation and referral relationships.  $400k in revenue, impressive growth potential.

 Home Health /  Colorado

Medicare-certified home health agency.  Houston-area.  Minimal census.

 Home Health /  Texas

Medicare-certified home health agency.  $1M+ in revenue.  Long-established agency with excellent community rapport.

 Home Health /  Texas

In-home DME manufacturer.  Patented mobility system.  $7.7M+ in revenue.  GSA/VA contract.  Strong industry supplier partnerships.

 Other /  California

$1M in revenue.  Small Medicare home health agency.  Region 5.

 Home Health /  Florida

Private pay home care.  $1.6M in revenue.  Profitable, great reputation.  Tenured staff.

 Home Care /  Illinois

Medicare-certified home health agency.  District 3.  Approximately $700k in revenue.  Accredited.

 Home Health /  Florida

Medicare-certified home health agency.  District 5.  Minimal census.  Accredited.

 Home Health /  Florida

$19.5M large home care franchisee.  89% Medicaid.  Well-established company operating more than 20 years.  Phenomenal year-over-year revenue growth.

 Home Care /  Illinois

$27M highly profitable, tech-enabled health care staffing company.  Provides on-demand workers for LTC facilities.  Impressive growth trends with extraordinary upside

 Other /  Midwest

Well-established and profitable franchisee.  Revenue of $4.9M.  Medicaid and private pay.

 Home Care /  Southwest

ABA in-home autism therapy for children.  $2.4M in revenue.  Strong growth and bottom line.

 Other /  California

Opportunity to acquire a Medicare-certified home health agency. JCAHO-accredited.  Zero deficiencies.  Region 9.

 Home Health /  Florida

Opportunity to acquire a Medicare-certified home health agency.  JACHO-accredited.  Zero deficiencies.  Minimal census.

 Home Health /  Pennsylvania

Opportunity to acquire a Medicare-certified home health agency.  Zero deficiencies.  Minimal census.

 Home Health /  Kansas

Rare southern hospice/home health CON opportunity.  $3.5M in revenue, 60+ hospice ADC.  Strong staff recruiting and retention.

 Home Health /  South

Medicaid/private pay, Medicare-certified.  $3 million in revenue.  CHAP-accredited.

 Massachusetts

4-star home health agency.  $2.5 million revenue.  Experienced management team.  Strong financials with outstanding local reputation.  Huge growth opportunities.

 Home Health /  Michigan

$1.5 million revenue chiropractic/physical therapy business.  High profit margin/low operating costs.  Diverse referral sources.

 Other /  Maryland

$3.3 million in revenue.  Autism center providing ABA, OT, PT and ST.  In-clinic and in-home services.

 Other /  Michigan

Non-skilled licensed home care organization.  Approx. $2 million in annual revenue.  Strong management team in place.  Southern California.

 Home Care /  California

Central Ohio-based home health company with private pay.  $2.3 million in revenue.  13.5% EBITDA.  Strong growth trends, full staff in place.

 Home Health /  Ohio

Hospice with $3.5 million in annual revenue. Accredited. No cap or regulatory issues.

 Hospice /  Texas / Popular

$2.5 million New Mexico home health agency. 87% Medicare. Long history in the community and existing staff in place.

 Home Health /  New Mexico

Home Health Index February 2022 | Stoneridge Partners

From Brian Bruenderman, Publisher of “Home Health Index.” Brian can be reached at [email protected] or (239) 561-0826, and toll-free at 800-218-3944. Previous editions of this monthly newsletter can be searched for at the bottom of the home page of the Home Health Index. Links to Google Finance: Amedisys | LHC Group