Review of mid-cap stocks for different biotech ETFs
Going by the market cap, the top ten mid-cap stocks of the iShares Nasdaq Biotechnology ETF (IBB) gave a return of -1.2% for the week ending October 23, 2015. The Healthcare Select Sector SPDR ETF’s (XLV) top ten mid-cap stocks returned -2.3%, the SPDR S&P Biotech ETF’s (XBI) top ten mid-cap stocks returned -0.8%, the iShares US Medical Devices ETF’s (IHI) top ten mid-cap stocks rose by 1.1%, and the iShares US Healthcare Providers ETF’s (IHF) top ten mid-cap stocks fell by 4.7% for the same period.
The above graph shows the performance of the top ten mid-cap stocks of different ETFs compared with SPY. IHI was the only ETF that gave positive returns in the top ten mid-cap space.
Team Health led the mid-cap space with 10.1% gains
Team Health Holdings (TMH) rose by 10.1% for the week ending October 23, 2015. The stock rose as it announced preliminary numbers for 3Q15. According to the press release, the net revenue is expected to be $899.2 million—a rise of 26.2% growth over 3Q14. The diluted net EPS (earnings per share) is expected to be $0.48. The adjusted EPS is expected to be $0.68. The adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) will be at $101.1 million—a rise of 13.6% over 3Q14.
Team Health Holdings also updated its full-year 2015 outlook and projected net revenue growth from 24%–26% to 25%–26%. It updated its adjusted EBITDA margin to 10.5%–11%. It closed at $57.97. It was trading above the 20-day moving average, but below the 50-day and 100-day moving averages. With its current price, the stock is trading at a PBV (price-to-book value) ratio of 8.04x. It has a weight of 1.4% in IHF’s portfolio.