Earnings season is almost over, and companies such as Kindred Healthcare, Genesis HealthCare and Brookdale Senior Living share the labor headwinds problem.
Earnings season is almost over, and if there was one word coming from companies like Kindred Healthcare, Genesis HealthCare and Brookdale Senior Living, it was “headwinds.” Although there are different headwinds, one common denominator is labor, specifically its cost. A year ago, many companies were downplaying its significance. No longer. Genesis announced its earnings, and its stock dropped 16%. The Ensign Group announced, its stock also dropped 16%. Brookdale announced no news regarding a capital event and continuing occupancy problems, and it went up slightly. And then there was Kindred. In addition to announcing it will be terminating its dividend at the end of March, the guidance was for a pretty flat year, with 2018 looking better, but with the ubiquitous labor headwinds. So what happened? In the first 90 minutes of trading the shares were up 14%. Maybe investors are focusing on the fact that Kindred’s home health and hospice business is worth more than the entire market cap of the company. Next up today is Capital Senior Living.
