Wells Fargo Downgrades Vanguard Health Systems (VHS) to Market Perform

March 28, 2013 7:23 AM EDT Send to a Friend
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Price: $21.01 --0%

Rating Summary:
    5 Buy, 12 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 24 | Down: 24 | New: 17
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Wells Fargo downgraded Vanguard Health Systems (NYSE: VHS) from Outperform to Market Perform with a valuation range of $14-$16 on PHP concerns.

"We are downgrading shares of Vanguard (VHS) to incorporate the potential for further downside to its share price from the lost Arizona Managed Medicaid contract," the analyst comments. "If the company loses the ~$50 million of EBITDA from its Phoenix Health Plan (PHP) we estimate a potential negative impact of about $5.00/share assuming an 8.0x multiple for that business. We have assigned a 50% probability to that outcome."

For an analyst ratings summary and ratings history on Vanguard Health Systems click here. For more ratings news on Vanguard Health Systems click here.

Shares of Vanguard Health Systems closed at $16.05 yesterday.


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