Oppenheimer Comments On Skilled Healthcare Group As It Considers Strategic Alternatives

Skilled Healthcare SKH announced that it plans to explore its strategic alternatives, which include a possible real estate sale or the sale of the entire company. The company is looking to take advantage of favorable market conditions, even though management remains optimistic about the outlook for the company. In a previous note, Oppenheimer had detailed its real estate analysis that valued the company at $17-21. Management said that no assurances can be made that the board of directors will ultimately conclude that a strategic alternative is in the best interest of the company. No timetable has been set for the completion of this review and the company does not plan to announce further developments in this process. With the reimbursement overhangs reduced, and the strong real estate valuations received by its competitors, this is an opportune time for SKH to consider its alternatives. Oppenheimer continues to favor SKH and the other nursing home companies. Oppenheimer has a $15 PT and Overweight rating on SKH SKH closed Monday at $14.02