Rennova Health Inc (NASDAQ:RNVA) Diversifies Revenue Stream

Rennova Health Inc (NASDAQ:RNVA)

Shares of Rennova Health Inc (NASDAQ:RNVA) were up by 5.97% after the company announced licensing approval for the opening of Big South Fork Medical Center in Tennessee. Opening of the 25-bed rural Acute Care Facility is now set for August 8, 2017.

The hospital will offer 24/7 emergency services along with radiology services such as X-Ray, CT scan, and nuclear medicine. Other services on offer include respiratory therapy, physical therapy, and laboratory services.

The opening of the new hospital according to chief executive officer, Seamus Lagan, underscores the company’s commitment to diversifying revenue streams.

“We believe the recurring and more predictable revenue we anticipate receiving from this hospital, while at the same time providing a needed service to a community, creates a new dawn for Rennova and our shareholders,” said Mr. Lagan.

Rennova Health Inc. (NASDAQ:RNVA) bills itself as a provider of a suite of healthcare related products and services. The company operates through three segments: laboratory services, supportive software solutions, and decision support and informatics operations.

Certainty Health Agreement

The company recently signed an agreement with Certainty Health. The agreement is for the development of next generation smartphone tools that assess the importance of genetic background in the treatment of various psychiatric diseases. The two company’s proprietary technology combines patented laboratory testing results with Artificial Intelligence to provide personalized treatments.

Under the terms of the agreement, Rennova Health Inc. (NASDAQ:RNVA) is to market consumer-facing genetic tests developed by AMS Group using the Certainty Health brand. Products on offer include those that determine how an individual might react to pharmaceutical drugs used to treat psychiatric disorders. Online ordering of the molecular tests should be ready by the fourth quarter.

“We look forward to working with Rennova Health to expand a mobile precision medicine platform to immediately address the unmet needs of patients and their caregivers for relevant molecular information impacting psychiatry today,” said Chris Yoo, Certainty President.

The collaboration seeks to deliver test results of patients to physicians and stakeholders in a bid to improve clinical diagnosis and treatment options. According to the National Alliance on Mental Illness, over 43.8 million people are currently being treated for psychiatric issues.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

AdCare Health Systems, Inc. (NYSEMKT:ADK) Trades Higher On Narrower Q1 Net Loss

AdCare Health Systems, Inc. (NYSEMKT:ADK)

AdCare Health Systems, Inc. (NYSEMKT:ADK) escaped the wrath of the Street on its Q1 2017 net loss attributable to shareholders, narrowing to -$2.8 million from -$3.7 million as of last year same period. The operator of nursing and assisted living facilities has attributed the performance to ongoing restructuring that has allowed the company to focus on areas of growth under a new business model.

Adcare Q1 Results

Revenues in the quarter totaled $6.1 million, a drop of 13.4% from $7.1 million in Q1 2016. The decrease was a result of the sale of nine Arkansas facilities late last year. General Administrative costs, on the other hand, were down by 36.2% to $1.6 million compared to $2.5 million as of last year. Reduction in personnel, as well as non-compensation expenses, is seen as a main cause of the reduction.

AdCare Health Systems, Inc. (NYSEMKT:ADK) says interest expense in the quarter was down by 43.5% to $1 million compared to $1.8 million as of last year. The company has attributed the decrease to the payment of a $36 million debt in connection to the Arkansas facilities. Loss from continued operations also narrowed to -$413,000 compared to -$528,000.

Cash and Cash equivalents as of the end of the quarter totaled $4.2 million less than half $14 million as of December 31, 2016.

Corporate Highlights

During the quarter the company completed its first acquisition under the new business model having purchased the Meadowood facility in Alabama. The assisted living and memory care facility purchased has 106 beds and cost the company $5.5 million.

Chief executive officer, Allan Rimland, remains confident that the facility will offer attractive economics with modest operation risk. There are also plans to pursue new acquisitions with the primary focus being in the skilled nursing sector.

“We observed significant improvements in overall portfolio operating metrics during the first quarter of 2017 and expect additional improvements in these metrics over the coming quarters. We continue to believe that local and regional operators with clinical, operational and financial focus are best positioned to successfully operate our facilities,” said Mr. Rimland.

During the quarter AdCare Health Systems, Inc. (NYSEMKT:ADK) also commenced a long-term lease that allows it to operate the facility of an affiliate to C. Ross Management, LLC. The terms of the agreement include a 13-year term with initial cash rent of $450,000. The company financed the acquisition with a conventional mortgage debt of $4.1 million.

AdCare Health Systems, Inc. (NYSEMKT:ADK) was up by 19.18% in Monday’s trading session ending the day at highs of $1.18 a share.

 I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

About the author: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.