Nobilis Health Corp (NYSEMKT:HLTH) Nobilis Health Corp (NYSEMKT:HLTH) owns and manages healthcare facilities in Texas and Arizona. The company specializes in elective out-patient procedures, deploying a patient acquisition strategy driven by direct-to-consumer marketing.
Nobilis is currently embarked on an aggressive campaign to boost revenue growth by gobbling up competitors. On August 2, 2016, Nobilis acquired Arizona Vascular Clinics in a $22.0-million cash and stock deal which added four surgery centers to its portfolio. Not slowing down, on January 9, 2017, Nobilis acquired Hamilton Vein Center for $13.25 million in cash and convertible notes. Hamilton Vein Center has approximately 19,000 in-network encounters per year.
Not surprisingly, the aggressive growth strategy has caused long-term debt to explode, but it’s still well under control at the moment. Long-term debt and capital lease obligations total $43.7 million as of September 2016, against full-year revenues likely to top $250.0 million and almost $20.0 million in free cash.
Given this, it is unsurprising that revenues keep exploding year-over-year. Total revenue for the first nine months of 2016 increased to $183.8 million, or 32.1% over the prior year. Net loss also shrank in the third quarter from $2.8 million from $10.9 million in the prior year, so they could reach net profitability soon.
Given that their services are mostly elective, a rising economic tide could mean that people book more elective surgeries at their centers. In you believe that the economy will break out, HLTH stock seems like a good bet at these depressed levels (currently $2.15 per share, down from a high of $9.34 in 2015).
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