'Elite' look at Almost Family (AFAM)

"Almost Family (NASDAQ:AFAM) is making its triumphant return to our 'focus list'of buys after we sold it in January," says analyst Tracey Ryniec. Here's her latest in Zacks Elite Stocks.

"Visiting Nurse provides skilled nursing and physical, occupational and speech therapy. Personal Care includes custodial and personal care services.

"The company's acquisition strategy continues with the May 27 announcement that it was acquiring the assets of Florida-based Central Florida Health Alliance (CHFA), a two-hospital health care system with home health branches.

"CHFA's operations generated $4.5 million in revenue in the last fiscal year, but Almost Family doesn't expect it to have a material impact on its 2009 results. The terms of the deal were not disclosed.

"The company continues to post strong earnings results despite the economic slowdown. On May 6, Almost Family surprised on estimates for the 6th straight quarter by 13.33%.

"Net income rose 118% to $5.6 million, or 68 cents per share, compared with $2.5 million, or 44 cents, in the year ago period.

"Revenue surged 77% to $69.2 million. The Visiting Nurse segment saw big gains, jumping 97% compared to a year ago with 41% of that coming from organic growth and the rest from acquired operations. Personal Care segment revenue gained 14%.

"Consensus estimates are rising for the second quarter and 2009. Second quarter estimates rose 3 cents to 67 cents in the last month.

"2009 consensus estimates jumped nearly 6% to $2.74 from $2.59 per share in the last 30 days, with 5 out of 6 covering analysts raising including one in the last week. Analysts expect year over year earnings growth of 26.04%.

"Overall, in our view, the stock has solid fundamentals. Almost Family is a Zacks #1 Rank (strong buy) stock. It is attractively valued with a forward P/E of just 9.5. The company has an outstanding 1-year return on equity of 21.03%."
 

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