Amedisys, Inc. AMED has completed the acquisition of Asana Hospice, a key hospice and palliative care provider. With this, the company has gained 100% of Asana’s ownership interests.
Asana provides hospice care to approximately 540 patients daily across eight locations in Pennsylvania, Ohio, Missouri, Kansas and Texas. With the completion of this deal, these eight locations will now come under the hospice network of Amedisys.
Per Amedisys, the buyout will prove to be a strategic fit as it will expand its reach in the hospice care business. This will pave the way for enhanced patient care, better support for clinical teams and raise more awareness of the hospice care benefits.
With this recent integration, Amedisys aims to strengthen its hospice care business on a global scale.
Rationale Behind the Deal
Amedisys is making significant efforts to broaden its hospice care base, backed by the growing general awareness about the benefits of hospice care. Asana’s acquisition, the third hospice care takeover for Amedisys in 2019, will lead to the operation of a total of 146 hospice care centers across 33 states.
Per a Grand View Research report, the U.S. hospice market size was estimated at $30.5 billion in 2018 and is expected to witness a CAGR of approximately 9% between 2019 and 2026. Factors like rising elderly population and increasing incidences of chronic as well as age-related diseases are expected to drive the market.
Given its market potential, the deal was closed at the right time.
In November 2019, Amedisys collaborated with nVoq, a provider of HIPAA compliant speech recognition solutions for the healthcare industry. The partnership will leverage nVoq's technology platform within Amedisys' home health and hospice business.
Additionally, Amedisys acquired the RoseRock Healthcare in April 2019 and Compassionate Care Hospice in February 2019.
Shares of Amedisys have surged 45.4% in the past year against the industry’s 16.2% decline.
Zacks Rank & Other Key Picks
Currently, the company carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space are Haemonetics Corporation HAE, Vapotherm, Inc VAPO and Medtronic plc MDT.
Haemonetics currently has a Zacks Rank #1 (Strong Buy) and a projected long-term earnings growth rate of 13.5%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Vapotherm’s long-term earnings growth rate is estimated at 49.5%. The company currently carries a Zacks Rank of 2.
Medtronic’s long-term earnings growth rate is expected at 7.4%. It is currently Zacks #2 Ranked.
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