Raymond James Ups Accredo Health to 'Strong Buy'

Analyst John Ransom says damage to earnings estimates isn't nearly as severe as he had originally expected

Raymond James upgraded Accredo Health (ACDO ) to strong buy.

Analyst John Ransom upgraded from market perform on a surprising earnings per share release. He says the primary reason for his opinion change is that the earnings damage estimated for Accredo's April 8 pre-announcement isn't nearly as severe as he had originally thought. Ransom says he slashed his fiscal 2003 (June) and fiscal 2004 estimates by 12% and 20% respectively, as Accredo cited sales weakness across several lines.

Now, he raised his $1.20 fiscal 2003 earnings per share estimate to $1.33, and upped the $1.32 fiscal 2004 estimate to $1.55. Ransom set a $24 target. He agrees that there's still some unanswered questions regarding volatility in Accredo's guidance, and he says he'll look for more detail on a conference call Monday afternoon.

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