AdaptHealth Corp (AHCO): A Deep Dive into Its Performance Metrics
Long-established in the Medical Devices & Instruments industry, AdaptHealth Corp (NASDAQ:AHCO) has enjoyed a stellar reputation. However, it has recently witnessed a daily loss of 9.04%, juxtaposed with a three-month change of -37.08%. Fresh insights from the GF Score hint at potential headwinds. Notably, its diminished rankings in financial strength, growth, and valuation suggest that the company might not live up to its historical performance. Join us as we dive deep into these pivotal metrics to unravel the evolving narrative of AdaptHealth Corp.
Understanding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
Financial strength rank: 4/10
Profitability rank: 4/10
Growth rank: 0/10
GF Value rank: 4/10
Momentum rank: 4/10
Based on the above method, GuruFocus assigned AdaptHealth Corp the GF Score of 56 out of 100, which signals poor future outperformance potential.
AdaptHealth Corp: A Snapshot
AdaptHealth Corp is engaged in providing patient-centered, healthcare-at-home solutions including home medical equipment (HME), medical supplies, and related services. It focuses on providing sleep therapy equipment, supplies, and related services to individuals suffering from obstructive sleep apnea (OSA), medical devices and supplies to patients for the treatment of diabetes, home medical equipment to patients discharged from acute care and other facilities, oxygen and related chronic therapy services in the home, and other HME devices and supplies on behalf of chronically ill patients with wound care, urological, incontinence, ostomy and nutritional supply needs. The company has a market cap of $1.04 billion and sales of $3.05 billion, with an operating margin of 5.24%.
Financial Strength Analysis
AdaptHealth Corp's financial strength indicators present some concerning insights about the company's balance sheet health. The company's low cash-to-debt ratio at 0.02 indicates a struggle in handling existing debt levels. Additionally, the company's debt-to-Ebitda ratio is 4.04, which is above Joel Tillinghast's warning level of 4 and is worse than 81.62% of 408 companies in the Medical Devices & Instruments industry.
Profitability and Growth Prospects
AdaptHealth Corp's low Profitability rank can also raise warning signals. A lack of significant growth is another area where AdaptHealth Corp seems to falter, as evidenced by the company's low Growth rank. The company's revenue has declined by -3.1 per year over the past three years, which underperforms worse than 76.48% of 727 companies in the Medical Devices & Instruments industry.
Conclusion
Given the company's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential underperformance. While AdaptHealth Corp has a history of success, these metrics suggest that it may struggle to maintain this trajectory in the future. As always, investors should conduct thorough research and consider multiple factors before making investment decisions.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
