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 long-term care services specialist Kindred Healthcare
So what: Kindred investors have suffered a steady beating ever since Medicaid decided to cut its 2012 payment rate to U.S. nursing homes by 11%, but the better-than-expected proposal for 2013 is quickly easing some of that pain. Not surprisingly, nursing home peers Select Medical
Now what: Don't let today's pop keep you from looking into the stock. Today's announcement essentially adds far more visibility into Kindred's future earnings power and, more important, gives the company much more time to adjust to future rate cuts. Jumping onto a rally isn't exactly ideal, but given just how badly Kindred has been punished over the past year, today's surge might only be the beginning of a much larger bounce.
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