BioScrip Falls on Weak Earnings and Guidance

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BioScrip, Inc. (NASDAQ: BIOS) reported third-quarter financial results before the markets opened on Tuesday. The company said that it had a net loss of $0.09 per share and $224.5 million in revenues. There were consensus estimates from Thomson Reuters that called for a net loss of $0.05 per share and $223.26 million in revenues. The same period from last year had $0.04 in EPS and $247.22 million in revenues.

Net revenues saw a decrease year over year partly as a result of lower than expected core sales volumes and partly as a result of anticipated revenue declines in connection with the ongoing shift in revenue mix to a greater percentage of core infusion revenue and less lower-margin chronic infusion revenue.

Home Solutions experienced double digit core revenue growth in 2016 prior to its acquisition compared to last year. The core revenues of Home Solutions and its continued growth will be accretive to the company on a go forward basis.

In terms of guidance, the company expects to have revenues in the range of $928 million to $934 million and EBITDA in the range of $27 million to $29 million for the 2016 full year. Consensus estimates are calling for a net loss of $0.27 per share and $940.89 million in revenues for 2016.

As for 2017, the company gave its preliminary guidance as revenues in the range of $940 million to $980 million and adjusted EBITDA in the range of $50 million to $60 million. Consensus estimates are calling for a net loss of $0.05 per share and $1.0 billion in revenue for 2017.

Daniel E. Greenleaf, President and CEO of BioScrip, commented:

I have just completed my first few weeks with the Company and based on my initial review it is clear we have work ahead of us.  We are acutely focused on continuing to improve our operating processes and deliver on our financial commitments.  I believe there is tremendous opportunity at the Company for improved financial performance over the next 18 months. I have made it clear to my leadership team and to the overall organization that the top five priorities that we must deliberately execute upon are driving profitable growth, delivering customer-centric service excellence, enhancing employee effectiveness, optimizing operational efficiencies, and exceeding cash collection targets.  Executing upon these five priorities drove the tremendous financial successes and increases to shareholder value at Coram and later at Home Solutions and I am confident that they will drive similar outcomes at BioScrip.

Shares of BioScrip were last trading down 48% at $1.36, with a consensus analyst price target of $3.88 and a 52-week trading range of $1.19 to $3.43.