AMN Posts Strong First-Quarter Results; Fair Value Estimate Remains Unchanged

Narrow-moat AMN posted strong first-quarter revenue growth of 75% year over year, which topped the high end of previously provided guidance, but we anticipate demand and billing rates to decline through the year and are leaving our fair value estimate at $85 per share. We think the omicron surge drove growth in all three business segments and believe acute demand for temporary staffing may have peaked in the quarter. We expect demand to decrease over the coming quarters, provided there is not another major COVID-19 wave. However, considering the pace of healthcare workers leaving their jobs and the tight labor market, which makes it challenging to secure new staff, we anticipate demand through the midterm will settle in at a higher level than we’ve seen historically.