HEALTH CARE : Abbey Healthcare’s Stock Continues to Fall Despite Record Results

Despite the record earnings it reported Tuesday, Abbey Healthcare Group Inc.’s stock was still headed south Wednesday. Shares of Abbey fell 12.5 cents to close at $26.875. Abbey’s stock peeked earlier this month after it was chosen as a top stock pick in the home health category at Smith Barney’s Annual Health Care Conference in New York. On Feb. 8, Abbey shares hit a new 52-week high of $29.50 based on the praise from the conference as well as rumors that the company was in talks to be acquired by Coram Healthcare Corp. in Denver.

“A couple of weeks ago, people thought the takeover was imminent,” said Ann Logue, an analyst with investment bank Volpe, Welty & Co. in San Francisco. Since that time, some analysts have started to question the viability of a possible Abbey-Coram merger, which has deflated the Costa Mesa company’s price somewhat, said Scott Butler, an analyst with the Red Chip Review research firm in Portland, Ore. Other stock analysts mentioned that they are still concerned that recent management changes at Abbey have exposed a weakness at the home health-care company despite its impressive fourth-quarter earnings.