Metropolitan Heath Networks (MDF)

[ghmm]

Thanks for the added detail Stan!

From what I've been looking at so far I really like the company and potential (Humana risk aside). I do not have a position (yet) as I would like to buy a little cheaper and also want to do some more DD but think it is certainly not overvalued here from what I've read/heard. I think people are worried about what healthcare reform will do but I figure longer term it will work its way out though '10 perhaps '11 may be a big question mark.

I would be more generous then you on the PE because I would back out the cash which is roughly half the current stock price. I like their cash flow and would love to see them use that to buyback. I also figure ownership of some practices has some value too (I put a lot of value in Book Value/underlying value of business outside of Earnings) I was happy to hear they upped the buyback to 15 million on the Q2 call as well.

I generally buy for the long term (years) and the way I have been envisioning it so far is if they get ~5-10% growth from the underlying business (and I think they have room to grow) they can easily double that if they keep an aggressive buy back. In a few years they could easily be at 25-30 million shares with still a substantial cash position and my price target would be a few multiples of where it is now even with a relatively low PE (backing out cash).

Do you by chance know if the Humana agreement is detailed in a filing? I've looked at the most recent K and Q but didn't go back looking yet for the agreement if you know off hand what year(s) to look would save me some time.

Thanks again for the response and your other informative posts too!