Another bad day in the market. And today they are taking down the HMO's. We have a couple on our list and if you own any, remember to keep a tight 8% stop on your losses. In my trading account, I haven't hit any 8% loss limits with this correction but I am close on Zoran with about a 6.5% loss. Goes down a few more pennies and it will hit the stop.
Anyhow, without giving up all hope and optimism...we are back at work here. Sunrise Senior Living, Inc., is actually having a nice day and fits almost all of our criteria. Currently it is trading at $23.95 up $.62 on the day. They announced their second quarter earnings today and managed to support the stock price in an otherwise poor trading day.
Sunrise reported that second quarter earnings per share were $.67, a 43 percent increase over the same period in 2002. Revenues rose 179% to $334.5 million from $119.9 million in the same quarter last year.
Morningstar.com shows a history of steady revenue growth from $89.9 million in 1997, $171 million in 1998, $255 million in 1999, $345 million in 2000, $428 million in 2001 and $506 million in 2002.
Free cash flow has improved recently from an unimpressive $5 million in 2000, $3 million in 2001, ($1) million in 2002 and a positive $58 million in the trailing twelve months as reported on Morningstar.
The assets/liabilities picture is a little disturbing with $72.2 million in cash and $77.9 million in other current assets with $195.8 million in current liabilities and $534.3 million in long-term liabilities.
While most of the picture looks o.k., the heavy debt picture makes me a little unenthusiastic about this selection. If you need an investment in this arena, this might be a nice selection. Otherwise, like me, you might just wish to pass. Have a great Wednesday!
Bob