HealthSouth Corporation’s (HLS) 2011 Earnings Estimate Raised
March 17, 2010 2:29 PM
Analyst Robert Hawkins at Stifel Nicolaus has released an update on HealthSouth Corporation (NYSE: HLS). After the comments made by the company’s management last week, Stifel Nicolaus has explored the company’s opportunity to redeem its 10.75% senior notes in June 2011. It expects the company will call the bonds in next year.
Stifel Nicolaus assumes that HealthSouth will redeem $494.9 million face value of notes for $107 or $530 million and will issue $530 million worth of 7-year senior notes with an 8.5% coupon. Based on this assumption, refinancing could be accretive for the company and therefore Stifel Nicolaus has raised its 2011 EPS estimate from $1.98 to $2.03.
Stifel Nicolaus has maintained its Buy rating and $21 price target for HealthSouth Corporation.
