Gentiva Health Services Earnings Preview

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While Gentiva Health Services (NAS: GTIV) missed estimates last quarter, investors hope that it will bounce back and outpace Wall Street expectations this quarter. The company will unveil its latest earnings Thursday. Gentiva Health Services provides comprehensive home health services throughout most of the United States.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Gentiva Health Services with seven of 10 analysts rating it hold. Analysts like Gentiva Health Services better than competitor Healthways overall. Three out of 12 analysts rate Healthways a buy compared with three of 10 for Gentiva Health Services. While analysts still rate the stock a hold, they are a little more optimistic about it compared with three months ago.
  • Revenue Forecasts: On average, analysts predict $466.2 million in revenue this quarter. That would represent a rise of 56.9% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.65 per share. Estimates range from $0.53 to $0.70.

What our community says:
CAPS All-Stars are solidly behind the stock with 97.8% assigning it an "outperform" rating. The community at large backs the All-Stars with 96.2% awarding it a rating of "outperform." Fools have embraced Gentiva Health Services, though the message boards have been quiet lately with only 71 posts in the past 30 days. Gentiva Health Services has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Gentiva Health Services' profit has risen year over year by an average of 22.5%. Revenue has now gone up for three straight quarters. The company's gross margin shrank by four percentage points in the last quarter. Revenue rose 54.4% while cost of sales rose 67.3% to $235.2 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

48.7%

49.9%

51.0%

54.5%

Operating Margin

10.5%

11.2%

6.7%

12.2%

Net Margin

2.9%

3.4%

2.1%

6.4%

For all our Gentiva Health Services-specific analysis, including earnings and beyond, add Gentiva Health Services to My Watchlist.

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At the time this article was published

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