LPNT
#I think of those two questions definitely the larger hospitals more stability, less volatility, a bigger mix of surgical volumes versus medical volumes happening in those larger markets, so larger, faster growing markets for sure to <UNK>'s point will create stability.
The expansion state seem to have more stability as well from a volume standpoint.
That's not just inpatient volumes but outpatient volumes as well through the ED and through our physician practices also.
So states are more mature in that like the state of Kentucky where it was one of the early adopters that got off to a quick start, some places like West Virginia.
I think it's too early to say that there is a definite difference between expansion and non-expansion but trends are starting to emerge that that appears where there is a little more stability, at least here four quarters into the expansion.
Andy, it's a great observation.
I think as the Q comes out and you can calculate on the press release we're well under three times leverage as we finish up the quarter.
But as we complete the pipeline that we have defined here we're likely going to see leverage that's north of 3.5 times and depending on certain other transactions that come through could approach 4.0 times EBITDA at least on an LTM basis from an EBITDA perspective.
So we are consistent with our past practice of being very judicious about when and how we deploy the stock buyback program.
So as you think through those numbers and <UNK> mentioned valuation, we are still in terms of valuation here the transactions that are closing today and through the end of the month have an average multiple of revenue that's less than half a turn.
Even with the addition of the two larger transactions we'll finish 2015 with purchase price less than 50% of revenue but it will still drive leverage up to the 3.5 to 4 times range.
So we will be thoughtful about the balance sheet and we will be thoughtful about the pipeline and utilize stock buyback as a use of our cash when the pipeline is thinner.
And we'll utilize acquisition as the pipeline is as strong as it is right now.
So Andy, with regard to the divestitures that we did recently those are all of the divestitures that are expected at this time.
Our decision to sell a hospital comes only after a great deal of consideration.
We don't take those decisions lightly.
Ultimately we came to the conclusion that those hospitals fit better with our provider with a stronger regional presence that could devote resources that were needed in those communities.
So to be clear these are the only divestitures that we have in mind, always recognizing that we have an obligation to constantly look at everything and along that line with regard to your second question we're very focused on creating value for our stockholders.
We've studied these REIT structures over the years.
It's not new.
We have certainly refreshed our analysis as they have become more popular, apparently recently.
But this structure is just one of many options that are available to attract capital and we have great access to capital.
So I think that's the answer for that.
Great, thank you very much.
In conclusion let me just say our teams are executing on the priorities that have and will remain our focus, delivering high-quality patient care and service, growing in existing markets and through acquisitions, continuously improving our operating efficiency and developing high-performing talent.
As we've said on our call today our acquisition pipeline remains active.
Our integration processes are effective and scalable.
We have the opportunity to build on our momentum, grow EBITDA and cash flow and create meaningful shareholder value in the coming years all while making our communities even healthier.
So thanks to all of you for joining our call today and thank you for your interest in LifePoint Health.
