Deutsche Bank Upgrades Health Management (HMA) and Community Health (CYH) to Buy on Activism

Deutsche Bank upgraded Health Management (NYSE: HMA) and Community Health (NYSE: CYH) from Hold to Buy with a price target of $18 (up from $12) and $59 (up from $51), respectively. The firm said HMA activism from shareholder Glenview raises upside probabilities.

The analyst commented, "HMA's largest shareholder, Glenview, is bringing a more activist agenda to the table based on its most recent 13G filing, and we now believe HMA's recent mgmt turnover and this increased activism are factors that significantly increase the probabilities HMA's board could put the company in play. In our view, HMA's Chairman of the Board, William "Bill" Schoen's 30-yr legacy at the company is on the line, and we believe a strategic take-over would unlock the greatest value -- with as much as $20 per share a realistic upside case. Given Glenview's cross-ownership of CYH, and CYH's appetite for deals, we upgrade both HMA and CYH to Buy given higher upside probabilities from this situation."

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

Shares of Health Management closed at $13.93 yesterday.

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