First Health Group
First Health reported earnings of $38.1 million, or $0.40 per share, compared to earnings of $35.7 million, or $0.35 per share, in the same period a year ago. The company said it's on target to meet its 2004 expectation for revenues of $950 million, with earnings of $1.55 per share -- the high end of its previous range.
Back in the fall, First Health shares lost about 25% of their value, when it reported third-quarter numbers. Facing a slowdown in new business, the health care provider, which acts as a middleman to reduce health-care costs, forecast a doubtful period ahead for growth.
Investors reacted to First Health's upbeat morning announcement that it had signed on several new clients and had sold extra services to existing ones. Considering its rather pessimistic viewpoint in the fall, it was a nice change from warnings of an apparent downturn in customers.
The rising cost of health care is an ongoing high-profile issue -- one that is certain to heat up with renewed attention from Congress. It seems to follow that a company like First Health, which works to reduce those costs, could be in line for consistent growth.
Talk it over with other Fools on the Healthcare discussion board.
Alyce Lomax does not own shares of the companies mentioned.