MedAssets Beats on Q3 Earnings, Revenues; Both Rise Y/Y
MedAssets, Inc. (MDAS) reported adjusted earnings per share (EPS) of 29 cents in the third quarter of 2014, beating the Zacks Consensus Estimate by couple of cents. Adjusted EPS increased 6.9% from the year-ago quarter.
Medassets, Inc - Earnings Surprise | FindTheBest
Quarter Details
Revenues grossed $176 million and steered ahead of the Zacks Consensus Estimate of $172 million. It also increased 5.5% from the year-ago quarter.
Spend and Clinical Resource Management (SCM) revenues increased 2.5% on a year-over-year basis to $106 million. The increase was primarily driven by higher group purchasing (GPO.V) net administrative fees. Sg2, the recent acquisition contributed $1.1 million to SCM and total revenue.
Net revenue in the Revenue Cycle Management (:RCM) segment increased 9.6% year over year to $70 million. Around 68% of this segment’s revenues can be attributed to SaaS-based Revenue Cycle Technology Tools.
Operating expenses increased 5.1% on a year-over year basis to $151.2 million primarily due to 13%, 10.7% and 8.4% growth in product development, selling and marketing and depreciation expenses.
Nevertheless, operating income expanded 40 bps on a year-over-year basis to 14%, due to higher revenue base, which fully offset increasing operating expenses.
Financial Position
Cash and cash equivalents were $13.9 million, compared with $6.0 million at the end of the previous quarter. In the first nine months of 2014, cash flow from operating activities were $96.1 million, while free cash flow was $55.7 million.
Guidance
MedAssets expects revenues for fiscal 2014 in the band of $715– $721 million. Adjusted EPS is expected to lie in the range of $1.34–$1.38.
Zacks Rank
Currently, MedAssets carries a Zacks Rank #2 (Buy). Other well-placed medical service stocks that warrant a look include BioTelemetry, Inc. (BEAT), ICON Public Limited Co. (ICLR) and BG Medicine, Inc. (BGMD). While BioTelemetry and ICON Public sport a Zacks Rank #1 (Strong Buy), BG Medicine carries the same Zacks Rank as MedAssets.
Read the Full Research Report on MDAS
Read the Full Research Report on BEAT
Read the Full Research Report on ICLR
Read the Full Research Report on BGMD
Zacks Investment Research
