Could PHC be the next target of consolidation in the behavioral services industry? |
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By Peter Deplama |
Thursday, 11 March 2010 03:00 |
Yesterday, shares of Psychiatric Solutions (NASDAQ: PSYS), the largest pure-play publicly traded behavioral health services company, surged more than 20% and is up again today after the company said it received an unsolicited offer to be acquired. Despite the fiscal second quarter being the seasonally slowest for the company, PHC earned a penny a share from continuing operations, versus a loss of 2 cents a year earlier. It has earned three cents for the first six months of the year, versus a loss of 4 cents in fiscal 2009. Last week, the company said that its new adolescent unit in Nevada which just came online would add an incremental 3 cents per share in earnings, above what the company already was scheduled to earn. With consolidation just beginning in the industry, PHC could represent an attractive target for a new industry entrant or somebody looking to expand.
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