Nucor earnings beat by $0.08, revenue fell short of estimates
On Wednesday, Canaccord Genuity downgraded Quipt Home Medical (TASE:BLWV) Corp. (NASDAQ:QIPT) stock rating from Buy to Hold and slashed the price target to $1.70 from $4.00. The downgrade comes as the stock has fallen nearly 22% in the past week alone, with year-to-date losses exceeding 45%. The firm’s analysts cited persistent revenue headwinds that have inhibited the company’s organic growth over the past year. According to InvestingPro data, the stock’s RSI suggests oversold conditions, potentially indicating excessive selling pressure.
Quipt Home Medical has faced a series of challenges, including the loss of a disposable supply contract and difficulties with capitated agreements that have impacted their revenue streams. With current annual revenue of $240.85M and an EBITDA of $43.75M, Canaccord Genuity’s analysts pointed out that these issues have led to a revenue decline of approximately 6% in the second quarter, indicating that the obstacles may persist longer than initially anticipated. Despite these challenges, InvestingPro analysis suggests the stock is currently trading below its Fair Value, with 8 additional exclusive insights available to subscribers.
The downgrade follows a previous update on February 13, where Canaccord Genuity lowered their estimates but maintained a Buy rating, expressing optimism that the revenue headwinds would diminish. However, the recent developments, particularly the loss of Humana (NYSE:HUM) HMO clients and the spillover effect on PPO members, have led to a reassessment of Quipt’s near-term growth prospects. While current challenges persist, InvestingPro data indicates that net income is expected to grow this year, with analysts predicting a return to profitability.
Canaccord Genuity’s analysts explained that the strategies Quipt Home Medical is employing to re-accelerate growth could take several quarters to yield results. Consequently, they expressed reduced confidence in the company’s ability to meet its organic growth targets of 8-10%, as frequently highlighted by management, within this fiscal year.
The revised price target of $1.70 reflects Canaccord Genuity’s adjusted expectations for Quipt Home Medical’s performance in the face of these ongoing revenue challenges. The firm will continue to monitor the company’s progress as it attempts to navigate and overcome these headwinds.
In other recent news, Quipt Home Medical Corp. held its annual general meeting where shareholders voted on significant company matters. The meeting resulted in the re-election of all four nominated directors to the company’s board. Gregory Crawford received the highest approval with 80.62% of the votes, while Brian Wessel, Kevin Carter, and Mark Greenberg also secured their positions with majority votes. Additionally, shareholders approved the re-appointment of BDO USA, P.C. as the company’s auditors for the fiscal year ending September 30, 2025. This decision was made with a significant majority, as 96.35% voted in favor. These developments were officially recorded in a recent SEC filing by Quipt Home Medical Corp.
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