Newport Beach-based Alliance HealthCare Services Inc. was downgraded Thursday by an analyst on concerns about the company’s business.
Shares of the medical imaging and cancer treatment company fell about 5% during Thursday trading before closing flat with a market value of about $264 million.
RBC Capital Markets analyst Kevin Ellich downgraded Alliance to “sector perform” from “outperform” in a report.
Ellich wrote that he downgraded Alliance because he didn’t believe that the volumne of medical scanning and prices would improve in the next few quarters.
Alliance’s diagnostic imaging volume is down because of the weak economy. Since unemployment rates are holding steady, volume should stay low, Ellich said.
On reimbursement, Ellich said payments from commercial insurers should be stable, but that Medicare rates may remain under pressure.
Alliance has enough cash to expand its business and that deals could boost its stock, although Ellich said any potential acquisition targets aren’t well-priced now.
