Fund Finds Health Care Gems Among Duds: The roof has been caving in on health care and insurance stocks, but Chris Wallis, co-manager of the Natixis Vaughan Nelson Small Cap Value Fund, has been finding big winners in the rubble.

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The nation’s leading provider of maternal-fetal, newborn and pediatric physician services announced that it completed a $100 million buyback program that had been authorized in December 2007.

Lower than expected birth rates hurt the company’s first quarter earnings, which came in at $55.8 million, or $1.14 a share, compared to net income of $24.5 million, or 51 cents a share earned in the same period last year. The result missed the street’s expectation and shares plunged 17%. Total revenue was $245.6 million, an increase of 16% from a year ago period, but missed analysts’ expectation of $251.3 million.

"We continue to grow our business, with solid contributions from acquisitions and ongoing improvements in reimbursement from third-party payors during this most recent quarter, and these results reflect our ability to continue to manage our operations with increased efficiency," said Roger J. Medel, M.D., CEO of Pediatrix.

Jefferies has a buy rating on the Ft. Lauderdale-based company and urges investors to pick up some shares on the unique buying opportunity. Jefferies set their price target at $68.

Outperform/Speculative - Price 55.43 on May 27
by Morgan Keegan

PDX announced that [neonatal-intensive-care unit] volumes through the first half of 2Q were down 2% on a same-store basis. As a result, PDX cut 2Q earnings-per-share guidance from [a range of] 85 cents to 87 cents [down to] to 77 cents to 80 cents....PDX announced a new $100 million share-repurchase authorization. ...Our view remains that...NICU volumes...will turn up later in the year, but we've lowered our '08 EPS estimate from $3.30 to $3.20 and '09E from $3.79 to $3.69. Market cap: $2.6 billion.

added 11/17/06 at 48.80