Serial Acquirer TeamHealth Holdings Inc (NYSE:TMH) May Sell Itself

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Investors scooped up shares of TeamHealth Holdings Inc (NYSE:TMH), a provider of outsourced healthcare professional staffing and administrative services to hospitals and other healthcare providers, after media reports speculated that the company was discussing a sale.

TeamHealth shares zoomed 16.46% and closed at $38.20 with 2.28 million shares changing hands.

According to a report in the Wall Street Journal, the company was discussing a sale with Blackstone Group and Bain Capital and may be taken private.

TeamHealth currently has a market cap of $2.8 billion and a deal could be reached as soon as this month. It chalked up $3.6 billion in revenue last year.

Compulsive acquirer TeamHealth Holdings Inc (NYSE:TMH) may itself be bought out

According to an August 2016 presentation, TeamHealth made 19 acquisitions in 2015 and 2016, including 10 ED, 4 anesthesia, 2 hospital medicine, 1 hospital medicine/post-acute provider services (IPC Healthcare), 1 ED/ hospital medicine, 1 hospital medicine, and 1 post-acute provider.

In fact, the company made its latest acquisition just two days ago. It bought out Florida Emergency Physicians (FEP), an emergency medicine staffing provider based in Orlando, Florida. FEP is the exclusive provider for 11 facilities spanning five counties within the Florida Hospital health system.

In November, TeamHealth rebuffed the overtures by AmSurg Corp, which had offered $69.32 per share in cash and stock, valuing it at $7.6 billion inclusive of debt.

TeamHealth Holdings Inc (NYSE:TMH) analyst ratings

Last week, Citigroup initiated coverage on the company with a Neutral rating and a price target of $36.00.

Analysts at Jefferies upgraded the stock from Hold to Buy in August after the company appointed Leif Murphy as President and CEO.  They have a price target of $47.00 on TeamHealth.

“We acknowledge that the appointment renders the sale of TMH as unlikely in the near-term, but believe Murphy’s incentives are structured to ultimately turnaround the company and possibly pursue a sale 1-2 years down the road,” said analyst Brian Tanquilut.

It looks like that sale may happen much sooner.

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