ExamWorks Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of independent medical exam provider ExamWorks (Nasdaq: EXAM  ) jumped 13% in intraday trading on higher-than-average volume.

So what: The move today came without any news from the company. In fact, it couldn't have come from company news since ExamWorks is still in its "quiet period" following its late-October initial public offering. Though the company's current market value is nearly $600 million, the average daily dollar volume is relatively low, meaning that any large buyer that gets interested in the stock may end up pushing up the price.

Now what: ExamWorks is a pretty neat business -- it's a roll-up of small IME providers that perform medical exams for insurers like Progressive (NYSE: PGR  ) , law firms, and government agencies. Richard Perlman, who most recently led TurboChef to a sale to competitor Middleby (Nasdaq: MIDD  ) , is the chairman of the company, and it looks as if he'll be targeting growth primarily through continued acquisitions of smaller IME providers. While the business model piques my interest, the financials should put investors on their guard. Though ExamWorks has rapidly expanded its revenue and operating profit via its acquisitions, it has also racked up a bunch of debt and doesn't have much of an operating history for us to hang our hats on. This could be an interesting stock to watch, but it would definitely end up on my "speculative ideas" list.

Want to keep up to date on ExamWorks? Add it to your watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or on his RSS feed. The Fool’s disclosure policy assures you no Wookiees were harmed in the making of this article.


Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1386132, ~/Articles/ArticleHandler.aspx, 9/20/2014 6:15:02 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement