Irvine-based Sun Healthcare Group Inc.’s stock soared Tuesday after an analyst upgraded the shares saying they’re undervalued.
Shares of Sun, which operates nursing homes and other healthcare facilities, were up 14% with a market value of about $500 million in afterhours trading.
Citigroup analyst Gary Taylor upgraded Sun to “buy” from “hold” in a report.
Taylor said he upgraded Sun because he believed investors have discounted the stock for a more severe Medicaid and Medicare reimbursement outlook than was probable.
The government health programs were 69% of Sun’s $457 million in third-quarter revenue.
