LHC Group, Inc. LHCG recently announced that it has finalized a joint venture (JV) agreement and purchase deal with AtlantiCare — A Member of Geisinger, a health services organization in Pennsylvania and New Jersey. The transaction involves purchase of home health and hospice services of AtlantiCare in Atlantic County, New Jersey.
The deal, which was initiated in February, is expected to expand LHC Group’s reach in New Jersey. Notably in April, LHC Group and Geisinger had finalized their JV partnership for home health and hospice services at Geisinger locations in Pennsylvania.
The deals are in line with the company’s current strategy of collaborating with JV partners to expand service capabilities in core markets.
LHC Group is a prominent national provider of in-home healthcare services and a preferred JV partner for 350 hospitals in the United States.
More About the Transaction
The home health and hospice service of Geisinger and AtlantiCare are known for delivering efficient patient-focused care. The service is aimed for patients who need access to healthcare within the comfort of their homes and for patients in need of end-of-life care.
LHC Group and its Healthcare JV partners provide healthcare services that have industry-wide renown for consistent quality and efficient patient care. They offer cost-effective care options that include resources and support to guide families of patients.
Per Markets and Markets, the global home healthcare market is estimated to reach $353.56 billion by 2022 from $237.05 billion in 2016 at a CAGR of 8.3%. Hence, this JV partnership is strategically-timed.
Other Recent JV partnerships
In May, JV partners LHC Group and Capital Region Medical Center (“CRMC”) signed an agreement to purchase from SSM Health the assets of one home health agency and one hospice agency in Mexico, Mo., and one home health agency in Jefferson City, Mo.Through this partnership, the companies will continue working with SSM Health providers in the region to provide enhanced services for patients.
At the beginning of this year, LHC Group and Unity Health announced that they have finalized an equity partnership agreement to buy and share ownership of two home health providers in Arkansas: Unity Health – White County Medical Center Home Health in Searcy and Unity Health – Harris Medical Center Home Health in Newport. Once the joint venture agreement is closed, the LHC Group will supervise the daily operations of agencies that will continue services from their current locations under a new name: Unity Health - HomeCare.
In the past year, the company’s shares have outperformed the industry. The stock has gained 48.8% compared with the industry’s 18.8% dip.
Zacks Rank and Key Picks
LHC Group currently caries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Cerner Corporation CERN, Penumbra PEN and Bruker Corporation BRKR. While Cerner sports a Zacks Rank #1 (Strong Buy), Penumbra and Bruker carry a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
Cerner’s long-term earnings growth rate is expected to be 13.5%.
Penumbra’s long-term earnings growth rate is projected at 21.5%.
Bruker’s long-term earnings growth rate is estimated at 11.7%.
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