AMN – Although management has concerns about near-term headwinds, market expectations are still too bearish, suggesting longer-term upside remains warranted

• AMN Healthcare Services, Inc. (AMN:USA) trades above recent averages relative to UAFRS-based (Uniform) Earnings, with a 19.7x Uniform P/E. Even at these levels, the market is pricing in bearish expectations for the firm, and while management has concerns about MSP services, operational issues in Locum Tenens, and nursing recruitment strategies, industry tailwinds and the firm’s leadership position in its space support long-term outperformance and equity upside
• Specifically, management may have concerns about their ability to provide workforce solutions to Tenet Healthcare and expand the services offered to MSP clients. Additionally, they may lack confidence in their ability to ramp-up hiring in Locum Tenens, and may be concerned about their revenue mix for Locum Tenens and Other Workforce Solutions. Moreover, they may be concerned about their nursing recruitment strategy, internal investments and acquisitions, and Travel Nurse price headwinds
• That said, AMN need only to sustain profitability near recently-improved levels to warrant upside, and industry tailwinds and the firm’s leadership position suggest this scenario is likely going forward