Main Wake up and good morning.
So what’s a rare and public gathering of hedge fund managers officially called A gaggle A pod A mistake We’re interested because , a major healthcare provider of oxygen and respiratory services — and a business adept at ignoring the local news media — got some arguably unwanted attention at the hedge fundfest. (Photo: Lincare headquarters by Joseph Garnett Jr. of the St. Petersburg Times.) As Barron’s notes in its current issue, the performance of nearly all the picks presented at last year’s conference was dismal. Perhaps that explains why so few of last year’s speakers came back for another go-around this year, reports Kiplinger’s. At the New York event, says Kiplinger’s, was Jim Chanos of Kynikos (which means cynic in Greek) Associates, described as “the short seller who famously uncovered fraud at Enron in 2001.” Chanos had a bone to pick with health-care companies. “There’s a new sheriff in town,” Chanos said, referring to President Obama. He thinks the administration views health care as a right that should be available to all citizens. Therefore, the government will squeeze profitability out of for-profit education and health-care companies. (Photo courtesy of Kynikos Associates.) Chanos called Lincare (ticker: LNCR) “the poster child” of the type of company that will suffer as the administration seeks to curb health-care costs. It’s not as if Lincare is booming at the moment, anyway. In the first quarter of 2009, Lincare revenues were $371.7 million, down from $415.4 million for the first quarter of 2008. And net income for the first quarter was $26 million compared to $58.2 million for the first quarter of 2008. The cause “Dramatic reductions,” said Lincare, in Medicare reimbursement for the company’s primary product lines, brought about by the implementation on Jan. 1 of previously enacted legislation.
Chanos apparently sees little reason those types of Medicare trims won’t continue under Obama.