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Arm of Ensign Group Unit Buys All County Home Care and Hospice

Zacks Equity Research

The Ensign Group, Inc. ENSG has announced that an arm of its home health and hospice portfolio subsidiary — Cornerstone Healthcare, Inc. — has purchased the assets of All County Home Care and Hospice in Boerne, TX. The transaction was effective Mar 1, 2019.

This deal is a strategic addition to the acquirer’s home health and hospice business. The combined expertise of both companies is expected to improve the health outcomes of patients in the San Antonio area. Ensign Group would gain traction from All County Home Care and Hospice’s skilled clinical and professional staff.
Cornerstone units would now run 24 home health operations, 25 hospice operations and seven home care operations across 12 states. Ensign Group is making concerted efforts to acquire well-performing and struggling home health, hospice and home care operations in the United States.

The home healthcare and hospice industry has been witnessing steady growth in recent years, primarily led by volume expansion, aging baby boomers and the shift from volume- to value-based care. This industry offers ample scope for growth and players are resorting to mergers and acquisitions for grabbing a greater pie of this booming industry.

Ensign Group boasts a strong inorganic growth story with several acquisitions in the past decade. Its historical progress has been mainly driven by its competence in acquiring real estate or leasing post-acute care operations and transforming the same into market leaders. With each takeover, the company has whetted its efficiency, both clinically and financially.

The company is on a spree to diversify its portfolio through strategic buyouts. Of late, it bought the real estate and operations of Creekside Transitional Care and Rehabilitation, Alpha Nursing, Cornerstone Home Health and Hospice in Utah plus Sequoia Hospice in California, Legend, the operations of Downey Care Center, etc. All these acquisitions augur well for the company’s overall growth.

Shares of this Zacks Rank #1 (Strong Buy) company have soared nearly 74.4% in a year’s time, outperforming its industry ’s rally of nearly 19%.

Other Stocks to Consider

Investors interested in the medical sector can also take a look at some other top-ranked stocks like UnitedHealth Group Incorporated UNH, Centene Corporation CNC and WellCare Health Plans, Inc. WCG, each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

UnitedHealth operates as a diversified health care company in the United States. In the last four reported quarters, the company delivered average beat of 3.39%.

Centene operates as a diversified and multi-national healthcare enterprise in the United States. It came up with average earnings surprise of 4.99% in the trailing four reported quarters.

WellCare Health offers managed care services to government-sponsored health care programs. The company pulled off average positive surprise of 15.43% in the preceding four reported quarters.

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