CCRN's 3Q Earnings Miss

Cross Country Healthcare Inc. CCRN reported revenues that missed expectations by Citigroup by ~$1.5M based on lower physician volumes and lower margins. In the report, Citigroup writes "Despite relatively low market expectations and a slight top-line miss, CCRN was able to hit at the upper end of earnings guidance on cost controls and a slightly lower tax rate than Q2. Stated 4Q guidance for EPS and revenue (see below) both fall below consensus, although management did state several times in the release they are experiencing normal seasonal trends, and even pointed to a "long-standing" lost vendor account re-upping their contact. While these statements are positive, we continue to believe weak hospital volumes & patient service utilization mixed with increased hospital "in-sourcing" will continue to weigh on the healthcare staffing industry." Citigroup maintains its Hold rating and $8.50 price target. Cross Country Healthcare closed yesterday at $6.85.