ExamWorks Group (NYSE:EXAM) Becomes Giant with Latest Acquisition

With the acquisition of MES Group, Inc., ExamWorks Group (NYSE:EXAM) has put themselves in an enviable position, having the strongest revenue position by far than their closed competitor.

Needham says, "After the close last Tuesday (1/11/11), EXAM announced a major acquisition, agreeing to buy its closest U.S. competitor for $210M...The deal takes out EXAM’s biggest competitor and creates a company that should have nearly $400 M in run rate revenue by year end, assuming no further acquisitions. Although the company will still have less than 8% market share, it will be more than 10x the size of the new number two competitor by revenue. At this point it is hard to imagine anyone assembling a platform in the U.S. that could challenge EXAM...There are multiple synergies."

Needham & Company reiterates a "Buy" rating on ExamWorks Group (EXAM), which closed Tuesday at $21.65, losing $0.35, or 1.59 percent. Needham raised their price target on ExamWorks from $25 to $27.