Goldman Sachs Discusses Hill-Rom Holdings

Goldman Sachs is out with a research report on Hill-Rom Holdings, Inc. HRC and it has a Neutral rating on shares. In a note to clients, Goldman Sachs writes, "Hill-Rom currently generates about 3% of revenue from SNF capital sales, and these products typically are lower-tech and lower-margin solutions. Hypothetically, assuming a worst-case scenario (in which the entire Hill-Rom SNF business goes away), our 2012 revenue estimate for the company would decrease by $51 mn. Additionally, we applied a 25% incremental margin on this business, resulting in a $0.14 dilutive effect to our EPS estimate, or roughly a 5.5% reduction. This is less than the sell-off in the shares today." Shares of HRC are down $3.02 to $34.27, a loss of 8.1%.