Date post: | 18-Jan-2017 |
Category: |
Health & Medicine |
Upload: | duff-phelps |
View: | 487 times |
Download: | 0 times |
Duff & Phelps
The S&P Healthcare Services Index has decreased 6.9% over the last month, performing worse than the S&P 500, which decreased 5.1% over the same period.
Over the past month:
• The best performing sectors were Dialysis Services (up 1.4%) and Specialty Managed Care (up 0.2%)
• The worst performing sectors were Pharmacy Management (down 17.5%), Consumer Directed Health & Wellness (down 16.8%) and Distribution / Supply (down 12.4%)
• The current average LTM revenue and LTM EBITDA multiples for the Healthcare Services industry overall are 1.93x and 11.7x, respectively.
• The sectors with the highest valuation multiples include:
• Healthcare REITs (12.11x LTM Revenue, 17.1x LTM EBITDA)
• HCIT (3.35x LTM Revenue, 17.7x LTM EBITDA)
• Contract Research Orgs (2.44x LTM Revenue, 13.1x LTM EBITDA)
• Other Services (2.08x LTM Revenue, 16.9x LTM EBITDA)
Healthcare Services Sector UpdateAugust 2016
BY THE NUMBERS
The S&P Healthcare Services Index has decreased 6.1% over the last month, underperforming the S&P 500, which decreased 0.1% over the same period.
Over the past month:
• The best performing sectors were Diagnostic Imaging (up 12.2%), Specialty Managed Care (up 6.1%) and HCIT (up 3.6%)
• The poorest performing sectors were Healthcare Staffing (down 14.9%), Psychiatric Hospitals (down 11.3%) and Home Care / Hospice (down 7.9%)
The current average LTM revenue and LTM EBITDA multiples for the Healthcare Services industry overall are 2.22x and 13.5x, respectively.
The sectors with the highest valuation multiples include:
• Other Services (1.91x LTM Revenue, 33.5x LTM EBITDA)
• HCIT (4.55x LTM Revenue, 23.4x LTM EBITDA)
• Consumer Directed Health and Wellness (3.80x LTM Revenue, 21.9x LTM EBITDA)
• Healthcare REITs (12.72x LTM Revenue, 19.0x LTM EBITDA)
Healthcare Services Sector Update
MARKET SECTORNo. of Cos.
Ag. Eqty Mkt.
Value
Average % Change LTM Multiples Earnings Ratio PEG Ratio 2016E1 mo 12 mo Rev EBITDA LTM 2016E
Acute Care Hospitals 5 $46,278 (4.8%) (17.1%) 1.17x 8.2x 16.4x 13.2x 1.4x
Assisted/Independent Living 3 3,820 (7.6%) (34.6%) 1.81x 10.7x NM NM NM
Care Management/TPA 5 5,439 (2.1%) 14.0% 1.18x 10.2x 25.1x 33.1x 1.5x
Clinical Laboratories 5 33,073 (2.5%) 18.5% 4.51x 14.9x 25.2x 17.6x 2.1x
Consumer Directed Health and Wellness 9 19,934 3.4% (1.5%) 3.80x 21.9x 32.2x 26.0x 1.3x
Contract Research Orgs 7 27,020 0.0% 8.6% 2.57x 14.2x 26.2x 17.9x 1.3x
Diagnostic Imaging 3 397 12.2% (0.2%) 1.75x 6.6x 23.9x 48.3x 3.9x
Dialysis Services 3 41,032 (7.9%) 5.4% 1.84x 9.1x 31.0x 20.6x 1.5x
Distribution/Supply 8 111,737 (4.1%) (4.0%) 0.89x 11.8x 19.2x 16.8x 1.6x
Emergency Services 2 2,036 2.2% (23.6%) 2.12x 13.6x 9.2x 13.7x 0.4x
HCIT 20 49,685 3.6% 3.8% 4.55x 23.4x 33.1x 32.5x 1.9x
Healthcare REITs 18 111,695 (1.5%) 24.3% 12.72x 19.0x 28.3x 35.9x 7.6x
Healthcare Staffing 4 8,628 (14.9%) (33.6%) 1.04x 11.5x 26.3x 15.7x 1.0x
Home Care/Hospice 7 6,458 (7.9%) 1.5% 0.98x 12.1x 26.4x 20.4x 1.7x
Skilled Nursing 6 3,195 (5.5%) (22.2%) 1.76x 8.0x 18.6x 12.9x 1.2x
Managed Care – Commercial 6 263,589 (2.5%) 6.2% 0.67x 10.5x 19.4x 19.8x 1.4x
Managed Care – Government 3 19,705 (1.3%) 8.1% 0.30x 7.3x 25.9x 19.3x 1.1x
Other Services 4 10,280 (2.3%) (22.1%) 1.91x 33.5x 38.3x 47.4x 2.6x
Pharmacy Management 4 48,247 (4.4%) (12.4%) 1.12x 16.5x 22.0x 15.9x 1.2x
Physician Practice Mgmt 2 6,083 (4.5%) (18.1%) 1.56x 12.3x 18.4x 15.9x 1.3x
Psychiatric Hospitals 3 6,343 (11.3%) (21.9%) 0.35x 16.1x 33.1x 21.1x 1.1x
Specialty Managed Care 2 5,924 6.1% 19.0% 0.37x 7.2x 17.2x 18.3x 2.3x
Surgicenters/Rehabilitation 7 12,127 (7.0%) (3.4%) 2.19x 11.2x 18.7x 22.0x 1.3x
Total/Average ($MM) 136 $842,726 (2.8%) (4.6%) 2.22x 13.5x 24.3x 22.9x 1.8x
Source: Capital IQ
CAPITALIZATION PROFILE
No. of Cos.
Ag. Eqty Mkt.
Value
% Total No. of Cos.
% Ag. Eqty Mkt.
Value
Average Stock Performance
1 mo YTD 12 mo 36 mo
> $5 billion 29 $678,417 21.3% 80.5% (2.3%) 4.8% 3.6% 48.6%
$1 billion – $5 billion 52 140,731 38.2% 16.7% (2.3%) 3.4% 1.7% 38.2%
$250 million – $1 billion 38 22,554 27.9% 2.7% (2.7%) 4.0% 0.2% 28.1%
$100 million – $250 million 4 598 2.9% 0.1% 3.1% 2.8% (9.5%) 0.2%
< $100 million 13 425 9.6% 0.1% 0.4% (12.8%) (36.7%) (28.2%)
Total/Average ($MM) 136 $842,726 100.0% 100.0% (0.8%) 0.4% (8.2%) 17.4%
Source: Capital IQ
MARKET INDICESValue at 8/31/16
% Change
1 mo YTD 12 mo 36 mo
Dow Jones Industrial Average 18,401 (0.2%) 5.6% 11.3% 24.2%
S&P 500 Index 2,170.9 (0.1%) 6.2% 10.1% 32.9%
NASDAQ Composite Index 5,213.2 1.0% 4.1% 9.1% 45.2%
Russell 2000 Index 1,239.9 1.6% 9.2% 6.9% 22.7%
AMEX Sector Index – Healthcare 80.6 (4.6%) (15.8%) (11.5%) (14.8%)
S&P Healthcare Facilities (Sub Ind) Index 301.9 (9.5%) (13.4%) (32.4%) 13.1%
S&P Healthcare Providers & Services (Industry) Index 578.7 (5.6%) (5.7%) (15.5%) 42.9%
S&P Managed Healthcare (Sub Ind) Index 463.6 1.9% 7.3% 5.6% 102.4%
S&P Healthcare Services 497.8 (6.1%) 3.1% 4.3% 50.5%
Source: Capital IQ as of August 31, 2016, and includes the most actively traded healthcare companies for respective covered sectors, excluding most microcap companies.
Duff & Phelps 2
INTEREST RATES Value at 8/31/16 1 mo ago 3 mo ago 12 mo ago
LIBOR – USD – 6 months 1.24% 1.11% 0.99% 0.53%
U.S. Treasury – 2 years 0.80% 0.67% 0.87% 0.74%
U.S. Treasury – 5 years 1.18% 1.03% 1.36% 1.54%
U.S. Treasury – 10 years 1.57% 1.46% 1.84% 2.20%
U.S. Treasury – 30 years 2.23% 2.19% 2.63% 2.63%
U.S. Prime Rate 3.50% 3.50% 3.50% 3.50%
Source: Capital IQ
S&P 500 Index NASDAQ Composite Index Russell 2000 Index S&P Healthcare Services Dow Jones Industrial Average
180
160
140
120
100
808/31/13 11/30/13 2/28/14 5/31/14 8/31/14 11/30/14 2/28/15 5/31/15 8/31/15 11/30/15 2/29/16 5/31/16 8/31/16
Source: Capital IQ Healthcare StaffingPsychiatric Hospitals
Dialysis ServicesHome Care/Hospice
Assisted/Independent LivingSurgicenters/RehabilitationSkilled NursingAcute Care HospitalsPhysician Practice MgmtPharmacy ManagementDistribution/Supply
Clinical LaboratoriesManaged Care – Commercial
Other ServicesCare Management/TPAHealthcare REITsManaged Care – GovernmentS&P 500 IndexContract Research OrgsEmergency ServicesConsumer Directed Health and WellnessHCITSpecialty Managed CareDiagnostic Imaging
0% 5%(5%)(10%)(15%) 10% 15%
Average % Change — 1 Month
Healthcare Services Sector Update
0.0x
5.0x
10.0x
15.0x
20.0x
25.0x
35.0x
30.0x
23.4x21.9x
19.0x
16.5x 16.1x14.9x 14.2x 13.6x
12.3x 12.1x 11.8x 11.5x 11.2x 10.7x 10.5x 10.2x9.1x 8.2x 8.0x 7.3x 6.6x7.2x
33.5x
Diagno
stic I
maging
Specia
lty M
anag
ed C
are
Manag
ed C
are –
Gov
ernmen
t
Skilled
Nur
sing
Acute
Care H
ospit
als
Dialys
is Serv
ices
Care M
anag
emen
t/TPA
Manag
ed C
are –
Com
mercial
Assist
ed/In
depe
nden
t Livi
ng
Surgice
nters/
Rehab
ilitati
on
Health
care
Staffin
g
Distrib
ution
/Sup
ply
Home C
are/H
ospic
e
Physic
ian P
ractic
e Mgm
t
Emergen
cy S
ervice
s
Contra
ct Res
earch
Org
s
Clinica
l Lab
orato
ries
Psych
iatric
Hos
pitals
Pharm
acy M
anag
emen
t
Health
care
REITs
Consu
mer Dire
cted
Health
& W
ellne
ssHCIT
Other S
ervice
s
23
33.5x
.4x21
23.9x
19
21
.0x
16
19
.5x 1616 .1x14
16.9x 1414 .2x 1314 .6x
1213
.3x 1212 .1x 1112 .8x 1111 .5x 1111 .2x 1011 .7x 1010 .5x 1010 .2x9
101x 89. 2x 8 08. 0x 7 38.0 3x 77.3 62x7. 6x6.
Overview of Subsector EV / LTM EBITDA
Performance of Market Indices for Latest 36 Months
Source: Capital IQ as of August 31, 2016, and includes the most actively traded healthcare companies for respective covered sectors, excluding most microcap companies.
Duff & Phelps 3
Source: Capital IQ as of August 31, 2016, and includes the most actively traded healthcare companies for respective covered sectors, excluding most microcap companies.
Duff & Phelps Copyright © 2013 Duff & Phelps LLC. All rights reserved. DPXXXXXX
For more information, visit www.duffandphelps.com
About Duff & Phelps
Duff & Phelps is the premier global valuation and corporate finance advisor with expertise in complex valuation, dispute and legal management consulting, M&A, restructuring, and compliance and regulatory consulting. The firm’s more than 2,000 employees serve a diverse range of clients from offices around the world.
M&A advisory, capital raising and secondary market advisory services in the United States are provided by Duff & Phelps Securities, LLC. Member FINRA/SIPC. Pagemill Partners is a Division of Duff & Phelps Securities, LLC. M&A advisory and capital raising advisory services are provided in a number of European countries through Duff & Phelps Securities Ltd, UK, which includes branches in Ireland and Germany. Duff & Phelps Securities Ltd, UK, is regulated by the Financial Conduct Authority.
Duff & Phelps Copyright © 2016 Duff & Phelps LLC. All rights reserved.
Brooks DexterHead of Healthcare M&A Los Angeles+1 424 249 1646 [email protected]
Jordan Lampos Director Los Angeles +1 424 249 1668 [email protected]
Eric CoburnManaging Director New York+1 212 450 2839 [email protected]
West ClarkVice President New York+1 212 871 9739 [email protected]
Laca Wong-HammondManaging Director New York+1 212 871 3915 [email protected]
For the detailed August trading multiples for individual healthcare services companies, please contact one of our professionals below.