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Lincare execs reap millions via stock plans – Tampa Bay – MSNBC.com
The 2003 Medicare reform law hurt Lincare in two areas beginning in 2005, said the president of The Weeks Group, a Melbourne-based management consulting firm for the home care industry. The law reduced reimbursement for durable medical equipment, including the oxygen equipment that Wallace Weeks called Lincare’s bread and butter, as well as fees Lincare collects for respiratory drugs mailed to patients nationally.

While some companies are getting out of the respiratory medicine business, others are finding ways to take cost out of their systems through different delivery methods or changing their payor mix, Weeks said. He expects Lincare, which is not a client of Weeks’, to follow suit.

Lincare has gone back to its suppliers to get better pricing, Lehman analyst Fischbeck wrote in a Feb. 14 report. Cutting the cost of goods and services has kept cash flow strong, allowing Lincare to buy back stock as well as expand through acquisitions, he said.

That positions the company to take advantage of disruption at competitors and be a consolidator in the market, wrote Fischbeck, who has a $47 a share price target for Lincare stock. Balaji Gandhi, an analyst at Oppenheimer, has set an even higher price target, $51 a share, citing expected acceleration in merger and acquisition activity among other factors.