Health Management Associates Second Quarter Earnings Sneak Peek

Health Management Associates, Inc. (NYSE:HMA) will unveil its latest earnings on Monday, July 23, 2012. Health Management Associates and its subsidiaries provide health care services to patients in owned and leased facilities located mainly in non-urban communities in the southeastern and southwestern United States.

Health Management Associates, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 21 cents per share, a rise of 5% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from 20 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 21 cents during the last month. Analysts are projecting profit to rise by 0% compared to last year’s 86 cents.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by 2 cents, reporting profit of 24 cents per share against a mean estimate of net income of 22 cents per share.

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A Look Back: In the first quarter, profit fell 32.1% to $37.7 million (15 cents a share) from $55.5 million (22 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 3.6% to $1.49 billion from $1.43 billion.

Stock Price Performance: Between May 18, 2012 and July 17, 2012, the stock price had risen $1.39 (22%), from $6.32 to $7.71. The stock price saw one of its best stretches over the last year between January 17, 2012 and January 25, 2012, when shares rose for seven straight days, increasing 15.7% (+91 cents) over that span. It saw one of its worst periods between November 11, 2011 and November 25, 2011 when shares fell for 10 straight days, dropping 18.4% (-$1.68) over that span.

Wall St. Revenue Expectations: On average, analysts predict $1.62 billion in revenue this quarter, a rise of 15.7% from the year-ago quarter. Analysts are forecasting total revenue of $6.56 billion for the year, a rise of 13.1% from last year’s revenue of $5.8 billion.

Key Stats:

After last quarter’s profit drop broke a string of income increases, this earnings announcement is definitely a chance for a rebound. Net income rose 22.6% in the second quarter of the last fiscal year, 23.9% in the third quarter of the last fiscal year and 9.5% in the fourth quarter of the last fiscal year before declining in the first quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 11.8% in the second quarter of the last fiscal year, 10.2% in the third quarter of the last fiscal year and 20.6% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Analyst Ratings: With 11 analysts rating the stock a buy, none rating it a sell and six rating the stock a hold, there are indications of a bullish stance by analysts.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.68 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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