UPDATE: Deutsche Bank Downgrades IPC The Hospitalist Company to Hold Following Q2 Results
In a report published Friday, Deutsche Bank analyst Darren Lehrich downgraded the rating on IPC The Hospitalist Company (NASDAQ: IPCM) from Buy to Hold, but reiterated the $48.00 price target.
In the report, Deutsche Bank noted, “IPCM's Q2 results were slightly below expectations due primarily to a sequential deceleration in encounter (volume) growth and flattish yoy margins. While 13.5% revenue and EBITDA growth is respectable, we believe IPCM's forward trading multiple (20.5x P/E and 11.4x EV/EBITDA) demands slightly more, and thus an earnings miss with decelerating fundamental trends seems disappointing. While we expect IPCM's EPS growth to track 14-15% over the next 24 months, we believe decelerating encounter growth (due to weaker hospital census and modestly higher physician turnover) poses some risk to the story. Moving to Hold on a more balanced risk/reward equation.”
IPC The Hospitalist Company closed on Thursday at $52.12.
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