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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: CRH Medical dropped >28% on Friday. I see they repaid their loan to Crown Capital as planned and have taken out a new credit facility (to 2020), reducing their interest expenses from 12% to 2.5% and providing cheaper capital for a future acquisition (3.5%), http://investors.crhsystem.com/1881-2/.

This would seem to be a big positive - quite apart from the recent re-imbursement issue which doesn't seem to realistically reflect the actual impact of any changes (i.e. is more benign than the market has anticipated).

So why the 28% drop? I got in at $4.47 - your advice, please? I'm tempted to buy more but I am/ should be an income investor (ha!).

Thanks as always,
Heather
Read Answer Asked by Heather on July 17, 2017
Q: TD Waterhouse Action Notes Summary Report dated July 7 2017 about "Questions regarding the sustainability of CRH's reimbursement rates have contributed to a two month slide in CRH's stock."
Here's the meat of it.
" We expect a relatively benign outcome to the 2018 fee schedule, partly because of CRH's limited exposure to CMS funding. Our sensitivity analysis indicates that a 5% cut in the Medicare reimbursement fee could cost CRH ~1% in adjusted EBITDA. ....
CRH has limited exposure to MEDICARE- We expect CRH's operating performance to be largely insulated from CMS for two reasons. First, Medicare only represents 10 to 15 % of CRH's revenues. Second, CRH's dominant payers (the private insurers) employ different reimbursement protocols from Medicare. We estimate that commercial payers reimburse the 00810 code at 3X-4X the rate of government payers.
TD Investment Conclusion
We are maintaining our buy rating but reducing our target price to $10.50 (was $12).
Our rating is based on three considerations: 1) leadership in a defensive, growing segment of the U.S. healthcare services market: 2) high margin cash flow streams and: 3) expansion opportunities within CRH's core anesthesiology market.
Hope this soothes a bit!
Read Answer Asked by Clarence on July 15, 2017
Q: Hi there

Any ideas for the big drop in CRH Medical today.

Much thanks

Stuart
Read Answer Asked by Stuart on July 14, 2017
Q: CRH is getting hit hard this morning. Why ? Is it our Short Sellor again ? RAK
Read Answer Asked by bob on July 14, 2017
Q: I own a fair bit of PHM, mentioned in a past comment, bought at 15 cents.
I noticed today that the debenture below just hit 52wh.
Patient Home Monitoring
PHM.DB-X
85.00 / 57.50
Question: if I want to add to my position, would the debenture be a better option or should I stick simply to the stock.
Thanks,
CDJ
Read Answer Asked by claude on July 14, 2017
Q: I have an average price on BMY shares of $69 having bought near peak price...when the recommendations by other analysts ( not 5i) were extremely positive. After, the company missed expectations with a drug and the downfall began. Now, I am wondering, what factors would you consider in making the decision whether to exit this losing trade and put the $$ into an alternate pharm company such as GUD or an ETF such as some you have recently mentioned IHI.
Read Answer Asked by Joanne on July 13, 2017
Q: I would like to invest n the US healthcare and have been recommended to invest in TMO but since this Would be the only stock in the healthcare that I would invest in I think it might be better to invest in a healthcare ETF and have found IXJ and IHI and wonder if better to invest in an ETF or ok just to invest in one US healthcare stock? If an ETF which one would you prefer?

Thanks
Read Answer Asked on July 12, 2017
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