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Is this Large Market Cap Stock target price reasonable for HEALTHSOUTH Corp. (NYSE:HLS)?

The company in question is, HEALTHSOUTH Corp. (NYSE:HLS) currently with a stock price of 40.33 (-0.81% today). The market cap for HEALTHSOUTH Corp. is 3650.86, and is in the sector Healthcare, and Specialized Health Services industry. The target price for HEALTHSOUTH Corp. is 46. Currently HEALTHSOUTH Corp. is trading with a P/E of 17.43, and a forward P/E of 14.97. Average volume for HEALTHSOUTH Corp. is 586.1 and so far today it is 228644.

Performance in the last year for HEALTHSOUTH Corp. has been 8.21%. For EPS growth, HEALTHSOUTH Corp. has seen a growth of -14.50%, and is looking to grow in the next year to 7.78%. More long term stats show that EPS growth has been -25.20% over the last five years and could be 14.00% for the next five years. HEALTHSOUTH Corp. has seen sales growth quarter over quarter at 20.10%, with EPS growth quarter over quarter at 49.50%. The 20-day simple moving average is -0.80%, with the 200-day simple moving average coming to 6.25%.

Since the IPO date for HEALTHSOUTH Corp. on the 9/13/1989, HEALTHSOUTH Corp. has seen performance year to date to be 18.94%. With HEALTHSOUTH Corp. trading at 40.33, the dividend yield is 2.36%, and the EPS is 2.33.

So could HEALTHSOUTH Corp., be undervalued? Well as said before P/E is 17.43. The PEG is 1.24, P/S is 1.06 and the P/B is at 5.4. The P/cash is 51.93, with P/free cash flow at 11.12.

HEALTHSOUTH Corp. ability to deal with debt shows that the current ratio is 1.4, and the quick ratio is 1.4. This is with long term debt/equity at 4.53, and total debt/equity at 4.59.

In terms of margins, HEALTHSOUTH Corp. has a gross margin of 96.10%, an operating margin of 17.80% and a profit margin of 6.30%.Payout ratio for HEALTHSOUTH Corp. is 37.90%. Return on assets come to 4.80% with return on investment coming to 10.10%.

Insider ownership for HEALTHSOUTH Corp., is at 0.90% and institutional ownership comes to 98.40%. Outstanding shares are at 89.79. While shares float is 87.39. The float short is currently 6.02%, and short ratio is 8.98.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Peter Clarke

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