Amedisys (NASDAQ:AMED) Faces Home Health Pressures

While Amedisys (NASDAQ:AMED) has a growing hospice business, the overall condition of the home health sector is under pressure on the lowering of Medicare pricing in 2011.

FBR says, "Amedisys is in the midst of realigning its resources to fit the needs of the market. But the company remains a market leader in the home health industry, with a growing hospice presence. The home health marketplace remains a challenge as Medicare pricing was cut for 2011 and could see a modest reduction in 2012. Amedisys, like its peers, must face the potential of rebasing in 2014 as well as wait for resolution of the pending investigations. We believe that regardless of the outcome of those investigations, the entire industry should expect to see a greater level of regulatory scrutiny. These factors remain overhangs on the industry and AMED shares."

FBR Capital reiterates a "Market Perform" rating on Amedisys (AMED), which closed Tuesday at $32.35, losing $0.89, or 2.68 percent. FBR raised their price target on Amedisys from $27 to $31.