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MEDNAX (MD) Q1 Earnings Miss Estimates, Decline Y/Y

Zacks Equity Research

MEDNAX, Inc. MD reported first-quarter 2019 adjusted earnings of 65 cents per share, missing the Zacks Consensus Estimate by 8.5%. Moreover, the bottom line decreased 27% year over year due to a rise in expenses and lower revenues.

Quarterly Details

The company generated revenues of $851.18 million, lagging the Zacks Consensus Estimate by 5.9%. Also, the top line was down 5.6% from the year-ago period.

General and administrative expenses inched up 0.1% to $101 million.

Interest expense of the company escalated 54.3% to $30.7 million, primarily due to higher effective interest rate on borrowings between the two periods.

In the quarter under review, adjusted EBITDA totaled $104.9 million, down by nearly 14.3%.

Mednax, Inc Price, Consensus and EPS Surprise

Mednax, Inc Price, Consensus and EPS Surprise | Mednax, Inc Quote

Financial Update

As of Mar 31, 2019, the company had cash and cash equivalents of about $46.5 million, down 2.2% from the level as of 2018 end.

The company incurred total debt of $2.1 billion, up 7.3% from the level as of Dec 31, 2018 and total assets of $5.7 billion, down 3.9% from the figure at 2018 end.

It used $60.4 million to fund operations in the first three months of 2019, down 48.3% year over year.

Capital Deployment

The company bought back shares worth $79 million in the first three months of 2019.

Second-Quarter Outlook

For the second quarter of 2019, the company expects adjusted EPS in the band of 84-92 cents, up from the previous guidance of 67-75 cents. MEDNAX projects adjusted EBITDA in the range of 125-$135 million, up from the past forecast of $108-$118 million.

This guidance assumes total same-unit revenue growth for the second quarter of 2019 from flat to 2% as compared to the prior-year period’s level.

2019 Guidance Revised

The company now estimates adjusted EBITDA within $505-$535 million, down from the earlier prediction of $550-$580 million.

Zacks Rank

MEDNAX carries a Zacks Rank 4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Among other players from the medical sector, which already reported first-quarter earnings so far, the bottom-line figures of Anthem Inc. ANTM, Centene Corporation CNC and UnitedHealth Group Inc. UNH beat the respective Zacks Consensus Estimates.

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