➡️ This is a step-by-step stock review to determine if AMN Healthcare (AMN) stock is a good buy. In this article, we’ll help you understand the company, where the company is going, the competition, and the leadership. This way you can make a more confident investment decision.
AMN Healthcare is a healthcare staffing company headquartered in Dallas TX with office locations in California, Florida, Georgia, Nebraska, Nevada, and North Carolina.
Table of Contents
- Step 1: Tykr Rating
- Step 2: Company History
- Step 3: Business Model
- Step 4: News
- Step 5: Competition
- Step 6: 4Ms
- Step 7: Is AMN Healthcare stock a good buy?
Step 1: Tykr Rating
➡️ Goal: When you look at a stock, the first step is to look at the financials. Fortunately, Tykr does this for us automatically. The higher the score, the stronger the financials and the safer the investment. The higher the MOS, the higher the potential returns you can make.
- Summary: On Sale
- Score: 95/100
- MOS: 90%
- Share Price: $99
- Fair Value: $498
The Summary, Score, and MOS of this stock may have changed since the posting of this review. Please login to Tykr to see up-to-date information.
Step 2: AMN Healthcare Company History
➡️ Goal: It’s important to know the company’s history. This helps us understand the various revenue streams, if they acquired other companies, how they grew through difficult times, and how they separated themselves from the competition.
- In 1985, AMN Healthcare service was founded and originally branded as American Mobile Nurses, Inc. Their first traveling nurse was Doris Ward.
- In 1987, American Mobile Nurses moved its headquarters from Las Vegas, NV to San Diego, CA.
- In 1990, Susan Salka, joins the company as CFO.
- In 1991, AMN Healthcare establishes its first executive client with Holy Cross Hospital in Fort Lauderdale, the US San Diego Medical Center, and New York University Medical Center.
- In 1991, AMN Healthcare launches American Mobile Therapists.
- In 1994, American Mobile Nurses and American Mobile Therapists merge to become American Mobile Healthcare.
- In 1996, AMN Healthcare launched its first website.
- In 1996, AMN Healthcare reached 1,000 traveling healthcare employees.
- In 1998, AMN Healthcare acquires Medical Express, a national traveling nurse staffing company based in Denver.
- In 2000, AMN Healthcare acquires Nurses Rx, a national traveling nurse staffing company based in Charlotte, NC.
- In 2000, AMN Healthcare launches its first portal site, NurseZone.com, a website that provides news, resources, career information, and lifestyle articles for nurses, students, and new graduates.
- In 2001, AMN Healthcare acquires O’Grady Petyon International, the leading international traveling nurse staffing company.
- In 2001, AMN Healthcare launches NursingJobs.com, an online job network for healthcare professionals.
- In 2001, AMN Healthcare goes public on the New York Stock Exchange.
- In 2001, AMN Healthcare launches TravelNursing.com, a website recognized as the authority in travel nursing.
- In 2002, AMN Healthcare acquires RN.com, an ANCC-accredited provider of continuing education for registered nurses.
- In 2002, AMN Healthcare is awarded the 2002 Staffing Industry Communications Award by the American Staffing Association in acknowledgment of “exceptional achievement” regarding work with the Thousand Smiles Foundation.
- In 2003, AMN Healthcare launches TheraTech Staffing, a brand dedicated to traveling healthcare professionals including radiation technicians, occupational therapists, and physical therapists.
- In 2004, AMN Healthcare launches its first scholarship program at San Diego State University’s School of Nursing.
- In 2004, AMN supported 6,000 hospital and healthcare facility clients.
- In 2005, Susan Salka was named CEO of AMN Healthcare.
- In 2005, AMN Healthcare acquires MHA Group (now branded Merritt Hawkins), the nation’s leader in temporary and permanent physician staffing services. This acquisition made AMN Healthcare the nation’s largest comprehensive healthcare staffing solution provider.
- 2007, AMN Healthcare acquires Rx Pro Health, an allied staffing firm specializing in temporary and permanent placement pharmacists, along with the pharmacy portal Pharmacy Choice.
- In 2007, AMN Healthcare launched NurseConnection.com, offering nurses an online community where they can connect, share experiences and learn about facilities, schools, and open positions.
- In 2007, AMN Healthcare launched AnesthesiaZone.com, an online resource for anesthesiologists and certified registered nurse anesthetists.
- In 2008, AMN Healthcare launches a healthcare industry standard known as RPO (Recruitment Process Outsourcing) which is designed to help organizations improve time to hire, candidate pool quality, and cost reduction.
- In 2010, AMN Healthcare partnered with the Clinton Health Access Initiative to recruit a pharmacy mentor to work in Port au Prince, Haiti following the country’s devastating earthquake.
- In 2011, Novation names AMN Healthcare its 2011 “Purchased Services Supplier of the Year.”
- In 2013, AMN Healthcare acquires Shiftwise, a leading national provider of web-based healthcare workforce solutions.
- In 2015, AMN Healthcare CEO Susan Salka celebrates 25 years at AMN Healthcare.
- In 2015, AMN Healthcare celebrates its 30th year in business.
- In 2015, AMN Healthcare acquires First String Healthcare to enhance interim permanent nursing leadership capabilities.
- In 2016, AMN Healthcare acquires B.E. Smith to expand its leadership position in healthcare workforce solutions.
- In 2016, AMN Healthcare acquires Peak Health Solutions to expand its portfolio of workforce solutions offerings.
- In 2017, AMN Healthcare ranked #11 on Fortune’s “100 Fastest Growing Companies” list.
- In 2019, AMN Healthcare acquires Silversheet to reduce the complexities and challenges of the credentialing process for clinicians and healthcare organizations.
- In 2019, Susan Salka was named CEO of the Year by CEO Connection.
- In 2020, AMN Healthcare acquires Stratus Video to broaden its footprint of lowering barriers to healthcare for people with limited English proficiency.
- In 2021, AMN Healthcare acquires Synzi, a virtual care communication platform that enables organizations to conduct virtual visits and use secure messaging, text, and email for clinician-to-patient and clinician-to-clinician communication.
- In 2022, AMN Healthcare selects Cary Grace as President and CEO.
- In 2022, AMN Healthcare acquires Connetics USA, an international nurse and allied recruitment company that specializes in nursing and allied professional direct hire recruitment and placements.
Step 3: AMN Healthcare Business Model
How does AMN Healthcare make money?
➡️ Goal: It’s important to know how a company makes money. A mature business model has multiple streams of revenue which allow the company to weather downturns in the economy.
AMN Healthcare Generates revenue through three primary revenue streams.
- Nurse and Allied solutions – 77% – AMN Healthcare provides hospitals and other healthcare facilities with a comprehensive managed services solution where they manage and staff all of the temporary nursing and allied staffing needs of a client. They also provide revenue cycle solutions, which include skilled labor solutions for remote medical coding, clinical documentation improvement, case management, clinical data registry, and provide auditing and advisory services. A majority of their placements in this segment are under our managed services solution, however, they also provide traditional direct nurse and allied healthcare staffing solutions of variable assignment lengths.
- Physician and Leadership solutions – 13% – AMN Healthcare places physicians of all specialties, as well as dentists and advanced practice providers, with clients on a temporary basis, generally as independent contractors. They also recruit physicians and healthcare leaders for permanent placement and place interim leaders and executives across all healthcare settings. The interim healthcare leaders and executives they place are typically placed on contracts with assignment lengths ranging from a few days to one year, and a growing number of these placements are under the managed services solution.
- Technology and workforce solutions – 10% – AMN Healthcare provides hospitals and other healthcare facilities with a range of workforce solutions, including (1) language services, (2) SaaS VMS technologies through which their clients can manage their temporary staffing needs, (3) workforce optimization services that include consulting, data analytics, predictive modeling, and scheduling technology, (4) recruitment process outsourcing services that leverage our expertise and support systems to replace or complement a client’s existing internal recruitment function for permanent placement needs, (5) virtual care services, and (6) credentialing services.
Step 4: AMN Healthcare News
➡️ Goal: It’s important to highlight important company-specific news as well as industry-specific news over the last month and year. We don’t need daily news on a company to make buy or sell decisions because we’re investors, not traders. Overall, we want sufficient news to understand where a company and industry are heading over the next year or few years.
This video from TheStreet highlights AMN Healthcare as a strong buy in 2023 because of the nursing shortage in the US. Due to the shortage, AMN Healthcare will continue to remain in demand.
This article from zacks.com lists 3 reasons why investors will love AMN Healthcare as a great investment.
- EPS growth rate is currently 34.5% An EPS growth rate over 10% per year is considered good.
- Cash Flow growth rate is 89.9% while the industry average is 29.1%.
- EPS estimates are expected to come in higher than expected, which should result in the share price continuing to climb upward.
This article from investorplace.com lists 7 small and mid-cap stocks investors may want to pay attention to. Those stocks include Enphase Energy, Axcelis Technologies, AMN Healthcare, Alpha and Omega Semiconductor, Alliance Resource Partners, AdvanSix, and Atkore. The reason AMN Healthcare is listed is that there is expected to be a shortage of 139,000 doctors in the US by 2033.
For the latest news on this stock, please login to Tykr.
Step 5: AMN Healthcare Competition
➡️ Goal: It’s important to understand who the competitors are and how their financials rank against this company. Try to find 5 other competitors to rank against based on Score. The best way to find competitors is to Google “XYZ competition” and replace XYZ with the company name. You can also go to Tykr and click on the “Similar Stocks” tab on each stock to see similar companies in the same industry.
AMN Healthcare (AMN)
- Summary: On Sale
- Score: 95/100
- MOS: 90%
- Share Price: $99
- Fair Value: $498
- Revenue: $3.98B
Cross Country Healthcare (CCRN)
- Summary: On Sale
- Score: 56/100
- MOS: 75%
- Share Price: $28
- Fair Value: $75
- Revenue: $1.6B
HealthStream (HSTM)
- Summary: Overpriced
- Score: 44/100
- MOS: 0%
- Share Price: $24
- Fair Value: $24
- Revenue: $256M
HCA Healthcare (HCA)
- Summary: On Sale
- Score: 61/100
- MOS: 69%
- Share Price: $261
- Fair Value: $606
- Revenue: $58.7B
Pediatrix Medical Group (MD)
- Summary: On Sale
- Score: 50/100
- MOS: 90%
- Share Price: $15
- Fair Value: $76
- Revenue: $1.9B
Agilon Health (AGL)
- Summary: Watch
- Score: 50/100
- MOS: 0%
- Share Price: $19
- Fair Value: $20
- Revenue: $1.8B
Ranking based on Score
- AMN Healthcare (AMN) – 95/100
- HCA Healthcare (HCA) – 61/100
- Cross Country Healthcare (CCRN) – 56/100
- Pediatrix Medical Group (MD) – 50/100
- Agilon Health (AGL) – 50/100
- HealthStream (HSTM) – 50/100
Step 6: AMN Healthcare 4Ms
➡️ Goal: All of our homework on this company leads up to the 4M checklist. A lot of investors only look at the numbers. Yes, it’s important to look at the first M (MOS) which is the math part of investing but it’s also important to look past the numbers and also look at the business, the competition, and the management. If all 4Ms pass, we should have high confidence in buying this stock.
✅ MOS: With a score of 95/100 and MOS of 90%, this is a very well-run company. The financials are nearly perfect.
✅ Meaning: It’s important to highlight that AMN Healthcare has been making acquisitions for decades. Some of these acquisitions are other talent placement firms while other acquisitions are software. The combination of both creates diversification of revenue streams which is an excellent strategy. It’s also important to highlight the “buy before build” philosophy of business scalability. Buy before build is a much faster way to introduce new revenue streams with less risk whereas “build before buy” is a mistake that inexperienced small businesses typically make. When building before buying, you spend more time building, testing, and working toward product-market fit. This can, in some cases, add years to the timeline. It’s much smarter to use free cash or debt to buy other companies.
✅ Moat: There are a lot of competitors in this industry but AMN Healthcare has made several acquisitions that have diversified the revenue streams. As mentioned in the Meaning, AMN Healthcare has a nice balance between service and product revenue. Aside from the revenue diversification, AMN Healthier ranks #1 against the competition.
✅ Management: Cary Grace was recently appointed CEO of AMN Healthcare after Susan Salk retired after working at AMN Healthcare for 33 years. Grace has over 30 years of experience in leadership roles at various companies. From 1990 – 1998 she served as Senior Vice President of First Chicago NBD. From 1998 – 20212 she served as Managing Director at Bank of America. From 2012 – 2021 she served in multiple leadership roles at Aon including President, CEO of Aon Health Exchanges, Chairwoman of Aon Trust Company, CEO, of Global Retirement, Investment, and Human Capital Business, and Special Advisor to the CEO. From 2020 – 2023, she served on various boards including League, FinTech Evolution Acquisition Group, and State Farm. The Glassdoor rating is 3.9 and the CEO approval is 92%. Both are very good scores. Overall, Grace has a lot of great experience leading multiple large companies.
If you’re interested, you may complete your own 4M checklist on this stock or other stocks by logging into Tykr.
Step 7: Is AMN Healthcare stock a good buy?
All 4Ms pass. AMN Healthcare is serving an industry that will most likely remain in demand over the next 10 years. The total return of the stock over the last 5 years has been 110% and the annualized return has been about 16%. If you’re looking for a strong company to add to your portfolio AMN Healthcare is worth a look.
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The Summary, Score, and MOS of this stock may have changed since the posting of this review. Please login to Tykr to see up-to-date information.
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