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Goldman Removes Lifepoint From Buy List, Downgrades To Neutral

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  • LifePoint Health Inc (NASDAQ: LPNT) shares have been on a downward path over the past six months, and are down 20 percent since July 20.
  • Goldman Sachs’ Matthew Borsch downgraded the rating for the company from Buy to Neutral, while reducing the price target from $78 to $81.
  • The downgrade is consistent with Goldman Sachs’ shift away from hospital companies, and more upside in other stocks, Borsch stated.

Since early June, LifePoint.’s shares have lost 7.8 percent, versus a 10.1 percent decline in the S&P500.

“We continue to see a promising idiosyncratic growth story in LPNT’s rollup and turnaround of rural hospitals,” analyst Matthew Borsch wrote. He added, however, that there is unlikely to be a significant company-specific upside catalyst that would boost LifePoint’s shares over the next 12 months.

While Louisiana’s decision to expand Medicaid is a positive for LifePoint, there is unlikely to be a substantial impact in 2016, given management’s recent comments. “We continue to monitor LPNT’s growth story and look forward to additional color with LPNT’s 4Q15 results and 2016 guidance introduction anticipated on February 12,” Borsch mentioned.

The adj. EBITDA estimates for 2015, 2016 and 2017 have been reduced from $723mn to $709mn, from $773mn to $765 and from $835mn to $802mn, respectively. The adj. EPS estimates for 2015, 2016 and 2017 have been reduced from $4.07 to $3.87, from $4.53 to $4.43 and from $5.04 to $4.66, respectively.

The downgrade reflects “more stock upside in other areas of our coverage…Our rating change is consistent with the shift away from hospital companies we made late last year,” the Goldman Sachs report noted.

Latest Ratings for LPNT

DateFirmActionFromTo
Apr 2017Deutsche BankInitiates Coverage OnHold
Jan 2017PiperJaffrayInitiates Coverage OnNeutral
Nov 2016Credit SuisseDowngradesOutperformNeutral

View More Analyst Ratings for LPNT
View the Latest Analyst Ratings

Posted-In: Goldman Sachs Matthew BorschAnalyst Color Downgrades Price Target Analyst Ratings

 

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