UPDATE: Stifel Nicolaus Initiates Kindred Healthcare with Hold on Regulatory and Reimbursement Overhangs

Stifel Nicolaus initiates its coverage on Kindred Healthcare KND with a Hold rating. Stifel Nicolaus notes, "Our Hold rating reflects our view that while the current reimbursement environment is stable, we believe investors are concerned about the impact of deficit reduction and entitlement reform initiatives on Medicare providers, particularly because tax increases and benefit cuts appear to be off the table. We expect Kindred to deliver improving results for the remainder of the year, but see Medicare uncertainty in 2013 clouding the shares' outlook." KND closed at $8.20 on Monday.