Winning Stock Forecast: OMI Gains 63.51% in 3 Days

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Over the period of August 7th to August 10th, OMI stock (Owens & Minor Inc., NASDAQ: OMI) price rose by 63.51% following a strong buy rating given by I Know First’s market forecasting algorithm.

OMI Business Overview

Owens & Minor, Inc. (OMI), together with its subsidiaries, operates as a healthcare logistics company. It operates through two segments, Domestic and International. The company offers supply chain assistance to the providers of healthcare services; and the manufacturers of healthcare products, supplies, and devices. Its service portfolio consists of procurement, inventory management, delivery, and sourcing of products for the healthcare market. The company also provides supplier management, analytics, inventory management, outsourced resource management, clinical supply management, and business process consulting services; and warehousing and transportation solutions comprising storage, controlled-substance handling, cold-chain, emergency and export delivery, and pick and pack services; and other services, such as order-to-cash, re-labeling, customer service, and returns management services, as well as custom procedure trays.

In addition, it engages in the third-party logistics and kitting businesses. The company’s portfolio of medical and surgical supplies comprises branded products purchased from manufacturers and proprietary private-label products. It serves hospitals, integrated healthcare systems, group purchasing organizations, the U.S. federal government, and biotechnology industries, as well as manufacturers of life-science and medical devices and supplies, including pharmaceuticals. The company has operations in the United States, the United Kingdom, France, Germany, and other European countries. It delivers its services through internal fleet, common carrier, or parcel services, as well as cold-chain delivery trucks. The company was founded in 1882 and is headquartered in Mechanicsville, Virginia.

Recent Financial Results – Q1 vs Q2 2019

The share prices jumped 63.51% following the release of OMI Q2 earnings report. In their Q2 conference call, OMI explained to investors about their plan to reverse its decline and drive near-term trading. 

Since the Q1 earnings report was released, OMI has continued to focus on their customers by placing rigor on their service levels, while also dedicating time to structure and strategy. A customer-centric focus remains a top priority for OMI.

From the Q1 2019 to Q2 2019, OMI saw revenue growth of 1% and adjusted operating income growth of more than 20%. Secondly, OMI also generated $90 million of operating cash flow in the second quarter. This cash flow was driven by improvements in operating income and working capital management. Third, OMI reduced their debt in Q2 by $60 million as compared to the end of Q1.

OMI’s strong focus on providing quality service to their customers through flexible and customizable solutions at an industry pace has made them indispensable. Additionally, integrated solutions and services help their customers mitigate risk and increase profit. 

Additionally, the improvement of operating metrics around safety, service and productivity through focus and training reduced operating expenses. For example, through focus and training OMI has reduced the distribution center workers compensation claims by approximately 40% in the first half of 2019, compared to prior years. 

In conclusion, OMI’s performance was better than expected and the stock is in a solid value range. Shares trade at 7 times the midpoint of this year’s earnings, which is a good price if the company continues to grow. 

I Know First Algorithmic Forecast for OMI

The upward movement of the stock was not without warning as, on August 13th, I Know First issued a 3-day forecast for OMI with a bullish signal of 1.18 and a predictability indicator of 0.14. Indeed, RGEN gained a remarkable 63.51% in the corresponding time horizon. The forecast referenced in this article was issued as part of the Fundamentals Stocks package.

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Algorithmic traders utilize these daily forecasts by the I Know First market prediction system as a tool to enhance portfolio performance, verify their own analysis and act on market opportunities faster. This forecast was sent to current I Know First subscribers.

Please note – for trading decisions use the most recent forecast.

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