OK ....so my $14 target doesn't look so good....LOL !! I have faith, Doubled down at $6.20 to average $7.10 and I have faith this baby will be $10.00 by end of quarter. GO ACHI !!!!!
Yes, clearly they are spending a ton on technology to get ready for value based payment models where they are behind so that is depressing earnings power. That said, there is still risk of Intermountain contract renewal in 2015, and $30-40m is Adjusted EBITDA, not FCF, so even at $6.50 I dont see this as that attractive of an investment.. at 7x EBITDA I might be willing to take on some of the customer concentration risk but not at 14x
Just looked back through my posts and that's exactly what I said in March 2013 - I've been pretty much on target all along... Too bad I didn't bet more $$$ on it.
Yesterday's call validated that $9 is way too high. It's going to be a good 18 months before they clear up the mess and get back on track, and they'll likely never get back to the growth they reported 2-3 years ago. Not to mention they'll be plagued with lawsuits and other distractions and expenses. I'm avoiding this one until they get their act together - too much risk in speculating right now.
I think $60-80m of cash flow is what was expected per a writeup that was circulated among the HF community earlier this year. There was a question of whether a good portion of the cash balance was a result of a large drawdown in receivables from the lost customer...looks like it was, and business has deteriorated some during the restatement period.
The business is far from dead, however. New management just needs to stabilize and then grow. RCM is alive and well despite what some would have you believe...Navigant, a consulting firm that was helping customers with RCM, acquired its own RCM business to bring the capability in-house given that it was referring so much business away.
Ultimately however, 20x FCF for a business that is declining on both the top and bottom lines in an industry that is becoming highly competitive doesn't seem like a bargain.
I do think that management is probably sandbagging here a bit...they'd be smart to. The new CEO likely wants to start 2015 with a clean slate and show what he did in the first full year on the job. Nonetheless, these results are a disappointment from what expectations likely were.
Appears expensive based on 2015 estimates of $35-40 million. However, ACHI generated over $55 million of net cash from customer contracting in 2011. For me, the question is whether new management can position the business so it generates annual net cash more in the range of $60-80 million by 2016-2017. Under this scenario, the stock is currently trading at an attractive discount to intrinsic value. I don't see the stock plunging nor rising to $14 by March. I do think the filing of the 12/31/14 10-K and subsequent stock listing (this stock trades by appointment on the "pink sheets") will create a slight tailwind for the stock.
Start buying in the $4-5 range. Outlook is far from good and as you mentioned is currently trading at 20x forecasted FCF. If it doesn't trade down tomorrow it should be a great short play in early 2015.
They throw all bad news into this announcement I bet. What new CEO wants to enter their first full year with the stock at 52wk highs? Sold all my shares today...Might repurchase after announcement
Please provide link to article from Penny Stock Weekly....Searched but couldn't find......This baby gonna explode over next 6 months..... Double up from my "Truck Load buy"