Last Call: HMS Holdings sinks as 1Q profit misses estimates

NEW YORK—Shares of HMS Holdings Corp., which provides cost recovery services to government health care programs, plunged Monday after the company's first-quarter profit fell short of Wall Street's expectations.

The New York company's profit increased 7 percent for the March quarter, rising to $3.2 million, or 12 cents per share, which was a penny below analyst estimates. Revenue grew 21 percent, to $38.9 million. Averaged together, the two analysts polled by Thomson Financial expected $37.6 million in revenue.

A year earlier, HMS earned 11 cents per share on $32.2 million in revenue.

The stock sank $5.60, or 21.4 percent, to $20.57 in afternoon trading.

The company maintained its full-year outlook, which is also slightly lower than analyst estimates. HMS forecast a profit of 73 cents per share on $170 million in revenue, while analysts are expecting 75 cents per share on $170.5 million in revenue.