11x Earnings For This Health Care Spin-Off

A Joel Greenbatt type opportunity

• This healthcare business was spun-off to raise funds for its parent. It now faces pressure from high interest expense and modest growth prospects.

• However, competent new management has identified several areas for improvement, hinting at a compelling turnaround within the business.

• At 11 times adjusted earnings much of the downside is priced in. Higher valuation multiples in line with peers, can lead the stock to double over the next few years.