Overview
In our decision to go long AMN in November of 2020, we laid out a series of four tailwind cycles that we felt would drive the stock in the near- term. Yesterday’s result and commentary supported our analysis. 2Q21 consensus was $712M heading into earnings last night, well below guidance, which includes $30M in vaccination staffing, that came in at $810-$830M. While we expect rates to slow as the COVID crisis abates, we expect high rate ICU and COVID staffing will be offset by increases in medical surgery and other core staffing that will cycle higher as we see a return to in-person care.
Management agreed with our view saying, "The very tight labor market and recovery in non-COVID demand caused volume and pricing to be stronger than expected this quarter and this trend is continuing into the second quarter." We suspect pent- up demand and other acuity drivers will keep temporary staffing and labor demand at the high end through 2022. Consensus is modelling a decline in revenue in 2022 versus 2021 which seems highly unlikely from our perspective of what the re- opening will look like for Health Care labor demand.
"Revenue in the second quarter of 2021 is expected to be 33-36% higher than prior year. Nurse and Allied Solutions segment revenue is expected to grow 34-37% year over year. Within this segment, we expect travel nurse staffing revenue to be up 30-33% from prior year. Allied revenue is expected to grow by about 38-40% year over year."
Health Care Macro
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Thomas Tobin
Managing Director
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