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1820 Investment Group

1820 Investment Group. Stock Recommendation Oct 8, 2011 Scott Kaufmann. Almost Family, Inc. (Ticker: AFAM). Almost Family, Inc., along with its subsidiaries is a regionally focused provider of home health services.

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1820 Investment Group

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  1. 1820 Investment Group Stock RecommendationOct 8, 2011 Scott Kaufmann

  2. Almost Family, Inc. (Ticker: AFAM) Almost Family, Inc., along with its subsidiaries is a regionally focused provider of home health services. The VN segment provides a range of Medicare-certified home health nursing services to patients in need of recuperative care, typically following a period of hospitalization or care in another type of inpatient facility. The PC segment provides services in patients' homes primarily on an as-needed, hourly basis.

  3. Growth & Profits • There is nearly unlimited growth opportunities • More and more baby boomers retiring and getting older / needing elder care • They prefer in-home care over hospital care • This company is the most solid financially, in this sector

  4. Revenue

  5. Numbers • Revenue: 336 million (2010 annual) • EBITDA: 16% • Net Income: 31 million • Current Ratio: 3.61 (lots of cash on hand, paid off all long term debt) • PE Ratio: 6.43

  6. Why a good time? • P/E is at historical Low • 6.43 is 5 year low, average 5 year P/E is 14 • Stock is down 55% this year… so why is it down?

  7. Risk • Roughly 2/3 of this companies revenue comes from Medicare! • Medicare is highly debated as a source of overspending. • Scandal with OTHER home care providers doing unethical and illegal Medicare billing • Presidential election will likely focus on cost savings, economy, etc…and Medicare could get put under the magnifying glass

  8. Recommendation • Let’s have some fun and take a chance. • Chances are that the company will either stagnate (if medicare is cut), or stock will skyrocket if Medicare spending holds steady.

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