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News Breaks
June 6, 2014
04:55 EDTMDAS, MDASMedAssets management to meet with Sterne Agee
Meetings to be held in Dallas/Houston on June 11 hosted by Sterne Agee.
News For MDAS From The Last 14 Days
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August 4, 2015
17:00 EDTMDASOn The Fly: Top stock stories for Tuesday
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10:33 EDTMDASMedAssets sinks on contract loss despite new activist interest
The shares of MedAssets (MDAS) are falling after disclosing that its supply chain contract with hospital chain Tenet (THC) had not been renewed. The fall this morning reverses a move higher in after-hours trading last night after investment adviser Starboard Value announced that it had obtained an 8.7% stake in the company, which provides management services to healthcare organizations. STARBOARD TAKE: In conjunction with the announcement of its stake in MedAssets, Starboard announced that it had sent a letter to to the company's CEO and board, expressing its view that its stock is "deeply undervalued" compared with its assets and earnings power. The activist investor unveiled a plan that it said would create significant shareholder value and raise the company's share price to $37-$46 by the end of next year. Among the steps advocated by Starboard were reductions in operating expenses, improved capital allocation and the exploration of all available strategic alternatives. This morning, however, MedAssets disclosed that it received notice that Tenet decided not to renew its supply chain deal. The deal, which will expire on January 31, 2016, is expected to generate 5%-6% of MedAssets' revenue this year, the company stated. PIPER TAKE: In a note to investors last night, Piper analyst Sean Wieland disagreed with Starboard's assessment of MedAsset's outlook. The company is facing "structural challenges," and it will be difficult to implement the $60M-$90M of operating expense reduction that Starboard is advocating without hampering the company's revenue or growth, Wieland contended. Additionally, MedAssets' margins are "unsustainable high" at current levels, the analyst stated. Reacting to MedAsset's loss of the Tenet deal in a separate note, Wieland pointed out that this is the second major contract loss for MedAssets in the last several weeks. Last month, MedAssets lost its group purchasing organization contract with another healthcare provider, St. Barnabas. The two contract losses will make it more difficult for MedAssets to obtain new business, predicted the analyst, who reiterated a $15 price target and Underweight rating on the shares. PRICE ACTION: In early trading, MedAssets fell 7.75% to $21.77 per share.
09:16 EDTMDASOn The Fly: Pre-market Movers
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08:34 EDTMDASMedAssets trading resumes, shares down $1.90 to $21.70
Shares of MedAssets gave up pre-market gains and turned lower after announcing the loss of a contract with Tenet (THC). The stock had been up following an activist stake by Starboard Value.
08:08 EDTMDASMedAssets says still evaluating business to improve growth
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08:07 EDTMDASMedAssets says SCS Agreement with Tenet not renewed
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08:02 EDTMDASMedAssets trading halted, pending news
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06:43 EDTMDASStarboard says plan would drive MedAssets share price to $37-$46 by end of 2016
Starboard Value on August 3, 2015 disclosed an 8.7% ownership stake in MedAssets making it one of the company's largest shareholders. Starboard also announced that it has delivered a letter to R. Halsey Wise, MedAsset's chairman and CEO, and the board of the company. Starboard looks forward to constructive dialogue with company management and the board regarding the company's business and opportunities to create significant shareholder value. The letter stated, "We understand that you are in the process of a comprehensive strategic review, and we would like you to take into consideration our views and the views of other shareholders as you continue to evaluate alternatives. Based on the extensive research that we have conducted, we believe that MedAssets is deeply undervalued relative to the quality of its assets, and the earnings power of its core business. We believe that there is an opportunity to unlock value by improving capital allocation, streamlining the company's cost structure, and improving corporate governance. In order to unlock this value, we believe that management should take appropriate action... We estimate that pursuing this plan of action could result in a stock price of $37-$46 by the end of 2016... We urge you to expeditiously evaluate your current cost structure and announce a comprehensive cost saving program and long-term margin targets. We expect that as you evaluate MedAssets' historical capital allocation and corporate governance practices, you will adopt policies that are significantly more shareholder-friendly. While you continue to work through the strategic review of MedAssets, we believe it is critical to consider all available strategic alternatives, including a sale of the company."
05:47 EDTMDASPiper Jaffray disagrees with activist Starboard on MedAssets
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August 3, 2015
19:01 EDTMDASOn The Fly: After Hours Movers
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17:40 EDTMDASStarboard reports 8.7% stake in MedAssets, outlines plan to boost stock price
On August 3, Starboard Value delivered a letter to MedAssets' chairman and CEO, R. Halsey Wise, and the company's board. In the letter, Starboard expressed its belief, among other things, that MedAssets is deeply undervalued relative to the quality of its assets and the earnings power of its core business. Starboard also outlined in the letter a plan to create significant shareholder value by reducing MedAssets' operating expenses, improving capital allocation, improving corporate governance and exploring all available strategic alternatives. In the letter, Starboard stated that it would like MedAssets' management and board to consider the views of its shareholders in connection with company's ongoing strategic review process. Starboard also expressed its belief in the letter that if MedAssets were to pursue Starboard’s plan of action, the stock price of the company could be $37-$46 by the end of 2016.
July 31, 2015
10:02 EDTMDASOn The Fly: Analyst Downgrade Summary
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06:18 EDTMDASMedAssets downgraded to Sector Weight from Overweight at KeyBanc
Keybanc downgraded MedAssets to Sector Weight based on healthy valuation and concerns that EBITDA growth may be limited due to negative mix shift in 2016.
July 29, 2015
16:29 EDTMDASMedAssets sees FY15 EPS $1.20-$1.26, consensus $1.19
Sees FY15 revenue $756M-$768M, consensus $759.58M. The company raised the midpoints of its full-year 2015 consolidated financial guidance, realigned the segment revenue mix based on year-to-date results, and narrowed the guidance ranges.
16:27 EDTMDASMedAssets reports Q2 EPS 31c, consensus 27c
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July 21, 2015
10:01 EDTMDASOn The Fly: Analyst Downgrade Summary
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06:04 EDTMDASMedAssets downgraded to Market Perform from Outperform at Cowen
Cowen downgraded MedAssets to Market Perform and lowered its price target to $22 from $25. The firm believes shares reflect optimism around a transformative corporate event such as a split between the SCM and RCM segments, that is less likely to happen.

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