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This Franchise’s Stock Will Double While Riding This Unstoppable Healthcare Trend

0 | By Michael A. Robinson

I can say from personal experience that home health care for seniors and hospice services are a godsend to millions.

And not just because there’s a lot of money up for grabs. More on that in a moment.

Here’s the thing. I recently mentioned that my father passed away after a battle with congestive heart failure.

We were fortunate to be able to find a crackerjack health team to work with him in his Virginia home. In fact, they were with him when he passed away on May 27.

So, I know first-hand that these services can bring big emotional payoffs.

More than just an essential service, home healthcare is also a very lucrative field that continues to grow alongside a national trend.

Analysts say the home health care market to be worth $225 billion by 2024.

Today, I’m going to reveal a leader in this field whose stock could double in less than three years…

The New World of Home Healthcare

By 2030, 20% of the population will be seniors. That’s nearly double the figure in 2009.

In other words, we have a long term growth cycle for home health care.

In addition to following big trends, I also know a great way to score market-crushing gains is to invest in savvy management. And that usually starts with a visionary CEO.

Enter: Paul Kusserow. At 58 he’s the quintessential man on a mission. He sees his role as serving his employees, so they are in the best position possible to serve his firm’s clients.

As the CEO of Amedisys Inc. (AMED), one of America’s largest providers of home, hospice, and personal care. He’s one of the main reasons I continue to recommend the stock.

The Renaissance CEO

Kusserow has a unique background for a high-powered executive.

Simply stated, he’s a scholar. Kusserow went to college at Virginia’s Wesleyan University, where he graduated with a degree in theology and religious studies.

Afterwards, he attended Oxford as a Rhodes Scholar, where he got a Master’s degree in English literature and language.

Not exactly your average MBA-toting executive.

With some 22,000 employees, Kusserow has his work cut out for him as he aims to serve each one of his workers.

Every month, he spends one week “on the ground.” This can mean joining sales calls, meeting with caregivers, or spending time with patients.

Bottom line: he invests in his workers and it pays off.

Since 2017, Amedisys’s Quality of Patient Care score has consistently trounced the competition. In another key quality metric, patient satisfaction, the firm has beaten the industry average since 2016.

A Growing Franchise

Last August, Amedisys signed a deal to merge operations with Brightstar Care, a company with 340 locations in 38 states that largely overlap with Amedisys’ own.

Together, the firms can increase the access and quality of home health care while reducing overhead.

That merger is just one of 17 acquisitions Amedisys has made in recent years.

For instance, in February 2019, CEO Kusserow doubled the company’s end-of-life business by acquiring Community Care Hospice.

And in late April 2020, the firm increased the number of hospice patients it can treat by more than 17.6% by buying AseraCare Hospice for $235 million.

As you can imagine, home health, hospice, and personal care isn’t just about staffing.

Care in the Age of Technology

This is also a tech-savvy business.

Amedisys uses scheduling and dispatch software to make sure no patient is left alone, not to mention software to help navigate the confusing maze of insurance policies.

Our timing here is good as well. After a 76% run last year, the stock is currently out of favor over concerns that post-Covid, life will go back to “normal” and this sector will suffer.

But I believe we are seeing a dramatic shift that will last for years as 77 million Boomers age and need services provided in their homes.

And Amedisys has the pole position here.

Consider that more than 3,000 hospitals and 59,000 physicians nationwide have picked Amedisys as their partner in caring for those coming out of acute care.

The Bottom Line

In the first quarter, sales were up almost 10%. That’s good, but the real news was profits.

See, in a sign of how profitable the company has become, Amedisys’ earnings for the first quarter rose more than five times as much, coming in with a 55% increase from the year before.

That’s well ahead of its three-year average growth of 31%. At that rate, earnings will double in less than 2.5 years.

We’ll know more about how the company is executing against its plan when it reports earnings on July 27.

Should it miss forecasts and the stock goes down, I suggest buying more on the dip.

Because this is a great long-term play on an unstoppable healthcare trend.


Michael A. Robinson

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