Nobilis Healthcare Poised for Growth

Nobilis Healthcare seems as if it is going to come out ahead amidst all of the turmoil that has recently afflicted the stock markets. The company owns and operates surgical centers throughout the United States. Besides enjoying strong organic growth year after year the company also make great use of aggressive, well-timed acquisitions. The company recently purchased First Nobilis Hospital for nearly $8 million cash according to googlefinance, it then went on to acquire a majority stake in Freedom Pain Hospital this past September for $3.2 million. However, due to its acquisitions the company according to cantechletter has currently also taken on debt at a relatively high cost, but it is working quickly to lower that cost as much as possible. During April of this year the company also finalized $25 million in financing from GE Capital, Healthcare Financial Services. This influx of cash will serve to greatly improve their bottom line. The cash will primarily be used to promote growth, provide working capital, and to rid the company of some of its longstanding debt, most importantly a $12 million note from when Nobilis purchased Athas Health last December. This capital also helps to significantly reduce Nobilis Health’s overall borrowing costs, which were at a staggering 9.6%, and help to provide a more streamlined approach to its finances. Thanks to this newly infused capital the Nobilis Health’s borrowing cost were more than halved, as low as 4.71% earlier this year. This will help the company be able to pursue growth opportunities much quicker than before. By creating this relationship with GE Capital the company is setting itself to be able to continue its growth for the foreseeable future. The loan consisted of a $20 million term loan as well as a revolving loan which would serve to provide working capital to the healthcare company. With an aging population and the widespread prevalence of obesity it does not seem as if the need for surgery will be slowing down anytime soon. This is great news for Nobilis as the increasing amount of surgeries being performed around the country help to boost its profits. Thanks to the significant growth and reduction of costs being experienced by the company many analysts are rating this stock a buy. In a report from Mackie Research Capital that details stocks that are set to grow the most coming in to Q4 Russell Stanley places Nobilis at the top of his list. The analyst is calling for a one year price target of $12.50 which would come as a result of a 72% return. The company has seen significant rallies since its first year going public. At one point it was up over 375% from its Year 1 high price. With recent growth analysts at Zacks have also named the firm a buy with at least one analyst rating it a strong buy.