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Category: Stock Market and Hanger
Date: 11 November 2019 Stock Price: $24.04 We take a look at the 3rd quarter earnings report of their 2019 fiscal year of Hanger, a provider of orthotic and prosthetic (O&P) patient case and distributes O&P products and rehabilitative solutions to the broader market
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About Hanger
Built on the legacy of James Edward Hanger, the first amputee of the American Civil War, Hanger, Inc. (NYSE: HNGR) delivers orthotic and prosthetic (O&P) patient care, and distributes O&P products and rehabilitative solutions to the broader market. Hanger's Patient Care segment is the largest owner and operator of O&P patient care clinics with approximately 800 patient care locations nationwide. Through its Products & Services segment, Hanger distributes branded and private label O&P devices, products and components, and provides rehabilitative solutions. With over 150 years of clinical excellence and innovation, Hanger's vision is to lead the orthotic & prosthetic markets by providing superior patient care, outcomes, services and value.
Financial overview of Hanger's 3rd quarter 2019 earnings report
The data below refers to the latest quarter unless specified otherwise:
- Total Revenue: $279.638 million (up from $262.946 million for the same quarter of the previous year)
- Revenue increased by 6.4% over the last 12 months
- Operating expenses: $249.233 million (up from $235.965 million for the same quarter of the previous year)
- Operating expenses increased by 5.6% over the last 12 months
- Net earnings: $5.691 million (up from$4.69 million for the same quarter of the previous year)
- Diluted earnings per share $0.15 (up from $0.12 for the same quarter of the previous year)
- Diluted number of shares outstanding: 37.349 million (up from 36.856 million for the same quarter of the previous year)
- Cash and cash equivalents $49.947 million
- Cash and cash equivalents per share: $1.33
- Cash and cash equivalents makes up 5.6% of Hanger's current market capital
- Cash and cash equivalents makes up 6.2% of Hanger's total assets
- Inventories: $75.693 million
- Inventories makes up 9.4% of Hanger's total assets
- Accounts receivable: $145.378 million
- Accounts receivable makes up 18.1% of Hanger's total assets
- Accounts receivable makes up 18.1% of Hanger's total assets
- Cash generated from operations (for 9 months): $19.945 million
- Cash generated from operations per share (for 9 months): $0.53
- Cash generated from operations per share (for 9 months): $0.53
Hanger's management commentary on their 3rd quarter 2019 earnings report
AUSTIN, Texas--(BUSINESS WIRE)-- Hanger, Inc. (NYSE: HNGR), a leading provider of orthotic and prosthetic (O&P) patient care services and solutions, today announced its financial results for the third quarter and nine months ended September 30, 2019.
Vinit Asar, President and Chief Executive Officer of Hanger, Inc., stated, "We are pleased with the solid revenue growth our Patient Care segment achieved in the third quarter. Our results reflected same clinic revenue growth of 2.1 percent which was driven by a 4.0 percent rate of growth in prosthetics. When coupled with the effect of acquisitions, this segment achieved a 7.9 percent overall rate of growth. With nine months of the year completed, we are continuing to execute within the mid-range of our financial outlook for 2019."
Vinit Asar, President and Chief Executive Officer of Hanger, Inc., stated, "We are pleased with the solid revenue growth our Patient Care segment achieved in the third quarter. Our results reflected same clinic revenue growth of 2.1 percent which was driven by a 4.0 percent rate of growth in prosthetics. When coupled with the effect of acquisitions, this segment achieved a 7.9 percent overall rate of growth. With nine months of the year completed, we are continuing to execute within the mid-range of our financial outlook for 2019."
2019 Outlook
Based on year-to-date results, the Company reaffirms its full-year 2019 net revenue and Adjusted EBITDA outlook of: Revenue in a range between $1.075 billion and $1.105 billion, and Adjusted EBITDA in a range between $121 million and $126 million. The Company plans to provide its financial outlook for 2020 when it reports its fourth quarter and full year 2019 results in March 2020.
This financial outlook for 2019 does not incorporate contributions from potential future acquisitions. Adjusted EBITDA is provided on a non-GAAP basis only because a reconciliation to the most comparable GAAP financial measure, net income, is not available without unreasonable effort due to the unpredictable nature of reconciling items that render such a reconciliation not meaningful for investors.
Based on year-to-date results, the Company reaffirms its full-year 2019 net revenue and Adjusted EBITDA outlook of: Revenue in a range between $1.075 billion and $1.105 billion, and Adjusted EBITDA in a range between $121 million and $126 million. The Company plans to provide its financial outlook for 2020 when it reports its fourth quarter and full year 2019 results in March 2020.
This financial outlook for 2019 does not incorporate contributions from potential future acquisitions. Adjusted EBITDA is provided on a non-GAAP basis only because a reconciliation to the most comparable GAAP financial measure, net income, is not available without unreasonable effort due to the unpredictable nature of reconciling items that render such a reconciliation not meaningful for investors.
Hanger Inc (NYSE: HNGR) stock price history
The image below, obtained from Google shows the stock price history of Hanger over the last 5 years. And its been a pretty average time for Hanger stockholders. 5 years ago the stock of Hanger was trading at around $21 a stock and its currently trading at $24.04 That's a average return of 14.4% provided to Hanger stockholders over the last 5 years. While the return is positive the opportunity cost of holding Hanger instead of say Netflix that returned over 300% over the same period of time becomes significant.
The stock of Hanger is trading at a lot closer to its 52 week high of $25 than it is to its 52 week low of $15.50 which to us is a clear indication that the short term sentiment and momentum of Hanger is very positive at this point in time.
The stock of Hanger is trading at a lot closer to its 52 week high of $25 than it is to its 52 week low of $15.50 which to us is a clear indication that the short term sentiment and momentum of Hanger is very positive at this point in time.
Recent coverage of Hanger
The extract below covers the latest regarding Hanger joining the S&P Small Cap 600 as obtained from TheStreet.com
NEW YORK, Oct. 22, 2019 /PRNewswire/ -- Hanger Inc. (NYSE: HNGR) will replace Rudolph Technologies Inc. (NYSE: RTEC) in the S&P SmallCap 600 effective prior to the open of trading on Monday, October 28. S&P SmallCap 600 constituent Nanometrics Inc. (NASD: NANO) is acquiring Rudolph Technologies in a transaction expected to be completed soon pending final conditions. Post merger, Nanometrics, which will remain in the S&P SmallCap 600, will have a name change to Onto Innovation Inc. and trade under the ticker symbol ONTO. Hanger provides orthotic and prosthetic services. Headquartered in Austin, TX, the company will be added to the S&P SmallCap 600 GICS (Global Industry Classification Standard) Health Care Facilities Sub-Industry index
NEW YORK, Oct. 22, 2019 /PRNewswire/ -- Hanger Inc. (NYSE: HNGR) will replace Rudolph Technologies Inc. (NYSE: RTEC) in the S&P SmallCap 600 effective prior to the open of trading on Monday, October 28. S&P SmallCap 600 constituent Nanometrics Inc. (NASD: NANO) is acquiring Rudolph Technologies in a transaction expected to be completed soon pending final conditions. Post merger, Nanometrics, which will remain in the S&P SmallCap 600, will have a name change to Onto Innovation Inc. and trade under the ticker symbol ONTO. Hanger provides orthotic and prosthetic services. Headquartered in Austin, TX, the company will be added to the S&P SmallCap 600 GICS (Global Industry Classification Standard) Health Care Facilities Sub-Industry index
Hanger Inc. (NYSE: HNGR) latest stock valuation
Based on Hanger's latest earnings report and the outlook provided what do we value the stock of Hanger at? Based on Hanger's earnings report and the outlook provided out valuation model provides a target (full value) price for Hanger Inc at $19.70 a stock, We therefore believe the stock of Hanger Inc. is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price, which in this case is $19.70. A good entry point into Hanger would therefore be at $17.70 or below. We expect the stock of Hanger to pull back from current levels to levels closer to our target (full value) price in coming weeks and months
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price, which in this case is $19.70. A good entry point into Hanger would therefore be at $17.70 or below. We expect the stock of Hanger to pull back from current levels to levels closer to our target (full value) price in coming weeks and months
Next earnings release of Hanger Inc.
It is expected that Hanger Inc's 4th quarter and full fiscal 2019 earnings report will be released towards the middle of February 2020