Morgan Keegan Raises PT On Healthcare Services Group To $19.25

Morgan Keegan has published a research report on Healthcare Services Group (NASDAQ: HCSG) after the company matched revenues estimates during its 4Q earnings report.

In the report, Morgan Keegan writes "Healthcare Services Group reported fourth quarter EPS of $0.14, matching our estimate and $0.01 short of consensus. Revenues topped our estimate as both the Housekeeping and Dietary divisions generated double-digit growth. Margins were lower than our estimate but we believe that the growth in costs, due in part to management infrastructure build-out, should moderate. We continue to believe that nursing home operators' concerns about Medicaid reimbursement, along with an increased focus on complex clinical programs, will fuel a continuing trend to outsource housekeeping, laundry, and dietary services to HCSG."

Morgan Keegan maintains its Outperform rating and has raised the price target from $18.75 to $19.25.

Healthcare Services Group closed yesterday at $17.16.