Metropolitan Heath Networks (MDF)

[Bobwins]

timhyma....mdf is a long time favorite of mine. Low p/e is a little deceiving. They have started up their own HMO in 6 counties immediately north of current territory that they subcontract from/for Humana. This startup will increase expenses by 750K/qtr for the next two years. May be lumpy, with extra startup expenses in q2/3. Don't know.

q1 already had the extra expenses. Unknown is how fast will revs from new operations ramp up and how will it impact previously profitable operations. Made .02 in q1 with full taxes for first time in several years plus HMO startup of $700K. I think .02 eps is more representative of future eps for MDF than ttm of .36, which has tax credits and no taxes.

Long term, this will likely be a winner due to excellent mgmt and opportunity in #2 Medicare market in the country.

Bobwins