Date : March 7, 2017
New Opportunity: First Choice Healthcare Solutions Inc. (OTCMKTS: FCHS)
If you’ve been waiting to get in the game, then you need to just jump on the playing field because this easy market isn’t going to end tomorrow, but it won’t last forever.
Today’s a great day to get busy, because we have an extremely promising stock to put in front of you: It’s the cure for society’s mistaken history of expecting great doctors to also be great business managers or shop-keepers.
FCHS is in the business of completely disrupting the healthcare space. And so far, it’s working!
Company: First Choice Healthcare Solutions Inc.
Latest News: http://finance.yahoo.com/q/h?s=FCHS+Headlines
Company Website: http://www.myfchs.com
Who is FCHS?
First Choice Healthcare Solutions Inc (OTCMKTS:FCHS) is implementing a defined growth strategy aimed at expanding its network of non-physician-owned medical centers of excellence, which concentrate on treating patients in the following specialties: Orthopaedics, Spine Surgery, Neurology, Interventional Pain Management and related diagnostic and ancillary services in key expansion markets throughout the Southeastern U.S.
Serving Florida’s Space Coast, the Company’s flagship integrated platform currently administers over 100,000 patient visits each year and is comprised of First Choice Medical Group, The B.A.C.K. Center and Crane Creek Surgery Center.
Actual revenue in 2014 was $7.0M, which came from 1,719 patient surgeries, driving an average patient value of $4,103. Surgeries increased to 2,060 in 2015, bringing in $17.7M in total patient revenue.
As of the end of Q3 last year, FCHS had already surpassed 2,045 surgical procedures and realized revenues in excess of $20.7 million with APV rising to $10,133, a 146% increase since 2014. The company has said it sees 2700 surgeries driving $27.3M in revs for 2016.
In the first case, FCHS “issued formal financial guidance of $40-$45 million for 2017 full year revenues” (11/22/2016). We know the TTM on the top line here is $29M for the prior comp period. That means management is telling us things are getting better… A Lot Better. This guidance implies… wait for it… AS MUCH AS 55% GROWTH this year.
They are on record with that guidance. And in our experience, companies at this stage very rarely promise what they can’t do because they know the market will kill them if they post a “miss”. So the stock is likely going to be operating this year with that type of monster growth in “mind”.
The company also more recently announced a key addition to the team in Dr. Steve Ryland, PT, DPT, who has been appointed to serve as the Company’s Director of Physical/Occupational Therapy.
In this role, Dr. Ryland will oversee the PT/OT Division and implement key expansion initiatives that will increase the number of First Choice-owned and operated, state-of-the-art PT/OT centers serving Florida’s high growth Space Coast service region from one to five centers in 2017 — with the second and third centers slated to open in March and the fourth and fifth center slated to open shortly thereafter. The new First Choice PT/OT centers will be strategically located throughout the service region, currently spanning 72 miles north to south on Florida’s central east coast.
Once all First Choice PT/OT centers are operational, they will have total capacity to administer up to 85,000 patient visits each year, generating up to $8 million in annual revenues.
First off, the float is tiny, at just 16.7M shares. So, whatever else one has to say, this stock has huge rally potential just on the basis of share supply and demand factors alone.
The stock is currently trading in what we call a “Triple Threat Setup”: It’s in a technical bull trend, but it’s hitting support at a key moving average, a trendline, and an RSI oversold level all at the same time.
When that happens within the structure of a technical Bull trend, the upside opportunity can be Explosive.
URGENT: All of that is hitting a stock with a TINY FLOAT- Just 16 Million Shares
- FCHS is sitting in a Triple Threat technical setup right now!
- FCHS is making real money, with trailing revs already coming in at $29M.
- FCHS is starting to see major topline growth, with quarterly y/y revs increasing at 22%.
- FCHS just announced major upside sales guidance for 2017, bumping the growth rate to as much as 55%
- FCHS is coming off an RSI trough under 40, pointing to an oversold stock now heading back the other way.
- FCHS has a small trading float of just 16.7M, which suggests the stock could launch higher on any additional influx of interest.
The company is seeing real growth and looks cheap compared to peers. According to company presentation materials, the peer group is valued by EV to EBITDA at over 10 as a ratio. Based on 2016 projected data (and the books are closed there), EV/EBITDA for FCHS is about half of that, suggesting the stock is a much better value.
However, based on their recent guidance for 2017, something has to give… if the stock is still pricing at present levels, it will at an EV/EBITDA ratio of just over 3!
There’s only two ways to bring that into normal range:
- The company stops making any money; or
- The price of the stock powers higher.
Keep that in mind today.