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Is the Options Market Predicting a Spike in Acadia Healthcare Stock?
ZACKS· 2025-05-20 13:36
Group 1 - Acadia Healthcare Company, Inc. (ACHC) is experiencing significant attention from investors due to high implied volatility in its options market, particularly the Jun 20, 2025 $65 Call option [1] - Implied volatility indicates the market's expectation of future price movement, suggesting that investors anticipate a substantial price change or an upcoming event that could trigger a rally or sell-off [2] - Acadia Healthcare currently holds a Zacks Rank 3 (Hold) in the Medical - Hospital industry, which is in the top 35% of the Zacks Industry Rank, but analysts have not increased earnings estimates for the current quarter, with a consensus estimate dropping from 77 cents to 71 cents per share [3] Group 2 - The high implied volatility surrounding Acadia Healthcare may indicate a developing trading opportunity, as options traders often seek to sell premium on options with high implied volatility to capture decay [4]
Acadia Healthcare Company (ACHC) 2025 Conference Transcript
2025-05-14 19:20
Acadia Healthcare Company (ACHC) 2025 Conference Summary Industry Overview - Acadia Healthcare is one of the largest behavioral health providers in the US, operating a network of 270 facilities with approximately 12,000 beds across 39 states and Puerto Rico, serving over 80,000 patients daily [6][7][8]. Key Financial Performance - The company reported that revenue, EBITDA, volume, revenue per day, and margins were all in line with guidance, with EBITDA at the high end of the range [2][3]. - Acadia added 378 newly licensed beds in Q1 and reaffirmed its full-year financial guidance for both revenue and adjusted EBITDA [3][4]. Demand and Growth Outlook - Consistent demand is observed across all four lines of business, with a significant opportunity in the behavioral health sector due to an estimated 75,000 additional beds needed in the US to meet demand [6][7]. - The company is in a period of record growth, expecting to add 800 to 1,000 beds in 2025, with nearly half already achieved in Q1 [10][11]. - The Comprehensive Treatment Centers (CTCs) segment is expected to grow mid-single digits over the next few years, with a strong demand for opioid use disorder treatment [9][15]. Operational Insights - The average cost per new facility bed is estimated at $500,000 to $550,000, with a target breakeven period of 12 to 13 months and expected maturity occupancy of 80% to 85% within three to five years [12][13]. - The company is focused on tuck-in M&A to acquire existing CTCs, which is a fragmented part of healthcare, enhancing growth and efficiency [18]. Policy and Regulatory Environment - Acadia is monitoring the implications of the opioid settlement funds, with $50 billion available but only a small percentage reaching states and counties [19][20]. - The company is optimistic about the potential impact of the reconciliation bill on access to high acuity mental health care, which could mitigate costs in other healthcare areas [24][25]. Pricing and Revenue Guidance - The company anticipates low single-digit pricing growth, with supplemental payments being a significant factor in revenue projections [46][47]. - For 2025, Acadia expects revenue growth of 6%, but EBITDA is projected to decline year-over-year due to various headwinds, including supplemental payment reductions and underperforming facilities [52][53]. Challenges and Risks - The company faces challenges from underperforming facilities, which are expected to impact EBITDA by approximately $20 million for the year [34][38]. - There is ongoing concern regarding potential policy changes and their impact on Medicaid access and reimbursement rates [26][30]. Conclusion - Acadia Healthcare is positioned for growth in the behavioral health sector, with strong demand and strategic plans for bed additions and acquisitions. However, it must navigate regulatory challenges and operational headwinds to achieve its financial targets [41][44].
Acadia Healthcare Q1 Earnings Top Estimates on Rising Admissions
ZACKS· 2025-05-13 16:10
Core Viewpoint - Acadia Healthcare Company, Inc. (ACHC) reported mixed financial results for the first quarter, with adjusted earnings per share beating estimates but showing a significant year-over-year decline, while total revenues showed slight growth [1][2]. Financial Performance - Adjusted first-quarter earnings were 40 cents per share, exceeding the Zacks Consensus Estimate by 14.3%, but down 52.4% year over year [1]. - Total revenues increased by 0.3% year over year to $770.5 million, aligning with consensus expectations [1]. - Same-facility revenues rose 2.1% year over year to $759.7 million, although this fell short of the estimated $763.1 million [3]. - Total adjusted EBITDA decreased by 22.8% year over year to $134.2 million, slightly below the estimate of $134.9 million [4]. Operational Metrics - Patient days improved by 2.2% year over year, contributing to increased admissions, which grew by 2.1% [3]. - Revenue per patient day declined by 0.2% year over year, missing the growth estimate of 2% [3][4]. - Total expenses rose by 13.1% year over year to $757 million, exceeding the estimate of $744.6 million, driven by higher salaries, wages, benefits, and operating costs [5]. Cash and Debt Position - As of March 31, 2025, cash and cash equivalents increased to $91.2 million from $76.3 million at the end of 2024 [5]. - Total assets grew to $6.1 billion, while long-term debt rose to $2.2 billion from $1.9 billion at the end of 2024 [6]. - Total equity decreased by 1% to $3 billion, with a net leverage ratio of approximately 3.2 [6]. Share Repurchase and Guidance - Management authorized a share repurchase program for up to $300 million, with $47.3 million worth of shares repurchased in the first quarter [7]. - The company reaffirmed its 2025 guidance, projecting revenues between $3.3 billion and $3.4 billion, adjusted EBITDA between $675 million and $725 million, and adjusted EPS between $2.50 and $2.80 [8]. Future Projections - Interest expenses are expected to remain between $130 million and $140 million, with depreciation and amortization expenses projected at $175 million to $185 million [9]. - Operating cash flows are forecasted to be in the range of $460 million to $510 million, with expansion capital expenditures anticipated between $525 million and $575 million [9]. - Management estimates bed additions between 800 and 1,000 in 2025 [10].
Acadia Healthcare(ACHC) - 2025 Q1 - Earnings Call Transcript
2025-05-13 13:32
Financial Data and Key Metrics Changes - First quarter revenue was $770.5 million, slightly above the midpoint of the guidance range of $765 million to $775 million [6] - Adjusted EBITDA for the first quarter was $134.2 million, near the high end of the guidance range of $130 million to $135 million [6] - Same facility patient days grew by 2.2% in the first quarter, impacted by an unfavorable leap year effect of approximately 110 basis points [6][15] - Adjusted EBITDA margin was 17.4% for the first quarter [16] Business Line Data and Key Metrics Changes - Same facility revenue grew by 2.1% year-over-year, driven by patient day growth of 2.2% [15] - Same facility adjusted EBITDA was $191.6 million, with an adjusted EBITDA margin of 25.2% [17] - Start-up losses related to new facilities were higher year-over-year and sequentially, reflecting an increase in newly constructed facilities [16] Market Data and Key Metrics Changes - Acadia added 378 new beds in the first quarter, including 90 beds to existing facilities and 288 beds from two new facilities [7] - The company expects to add between 800 to 1,000 total beds for the full year 2025 [18] Company Strategy and Development Direction - Acadia's strategy focuses on high-quality care and clinical health outcomes, with a commitment to quality and safety as foundational elements [10] - The company aims to bridge the gap between physical and behavioral health care, enhancing relationships with referral sources and joint venture partners [7] - Acadia plans to continue expanding its market reach, with expectations to add between 600 to 800 beds annually from 2026 to 2028 [8][21] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand for behavioral health services, particularly for higher acuity patients [39] - The company remains engaged in policy discussions to strengthen the behavioral health care system and expects continued support for essential care [12] - Management acknowledged the challenges posed by underperforming facilities but indicated that improvements are expected over time [17][19] Other Important Information - As of March 31, 2025, Acadia had $91.2 million in cash and cash equivalents and approximately $900 million available under its revolving credit facility [18] - The company repurchased approximately 1.6 million shares during the first quarter for a total of $47.3 million [18] Q&A Session Summary Question: Can you provide perspective on the progression of EBITDA and seasonality of the business this year? - Management highlighted several moving parts affecting EBITDA, including the timing of supplemental payments and the impact of start-up costs from new beds [25][28] Question: What are you seeing in Medicaid rate updates? - Management noted stable underlying rate growth and a cautious approach to assumptions due to policy uncertainties [32][34] Question: How is the broader demand environment for behavioral health? - Management indicated consistent demand for services, particularly for higher acuity patients, and ongoing efforts to meet that demand through new facilities and bed additions [39][41] Question: What is the expected return target for new facilities? - Management emphasized a disciplined approach to capital deployment, ensuring returns exceed the cost of capital [65][66] Question: How should we think about legal expenses moving forward? - Management is actively cooperating with ongoing investigations, and while it's difficult to predict future legal costs, significant preliminary work is being undertaken [73][74] Question: Can you provide guidance on Q2's percentage of annual guidance? - Management refrained from providing specific Q2 guidance but noted that supplemental payments, particularly from the Tennessee program, would be a significant swing factor [79][80] Question: What is happening with specialty revenue? - Management acknowledged a year-over-year decline in specialty revenue and indicated ongoing efforts to address this issue [104]
Acadia Healthcare(ACHC) - 2025 Q1 - Earnings Call Transcript
2025-05-13 13:30
Financial Data and Key Metrics Changes - First quarter revenue for 2025 was $770.5 million, slightly above the midpoint of the guidance range of $765 million to $775 million [5][14] - Adjusted EBITDA for the first quarter was $134.2 million, near the high end of the guidance range of $130 million to $135 million, reflecting an adjusted EBITDA margin of 17.4% [5][15] - Same facility patient days grew by 2.2% in the first quarter, with same facility revenue growth of 2.1% compared to the first quarter of 2024 [5][14] Business Line Data and Key Metrics Changes - The company added 378 new beds in the first quarter, including 90 beds to existing facilities and 288 beds from two new facilities [6] - Same facility adjusted EBITDA was $191.6 million, with an adjusted EBITDA margin of 25.2% [16] - Start-up losses related to new facilities were higher year-over-year and sequentially, reflecting an increase in newly constructed facilities [15] Market Data and Key Metrics Changes - The company expects to add between 800 to 1,000 total beds for the full year 2025, with a solid pipeline of potential opportunities in attractive markets [7][18] - The company anticipates Medicaid supplemental payments to be flat to up $15 million in 2025 on a net basis [19] Company Strategy and Development Direction - Acadia's strategy focuses on high-quality care and clinical health outcomes, with a commitment to quality and safety as foundational elements [10][12] - The company aims to bridge the gap between physical and behavioral health care, maintaining strong relationships with referral sources and joint venture partners [6] - The company is engaged in policy advocacy to strengthen the behavioral health care system, emphasizing the importance of government support for underserved populations [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand for behavioral health services, particularly for higher acuity patients, and noted consistent demand across various lines of business [38] - The company acknowledged challenges from underperforming facilities but expects to see improvements as they comp over headwinds in the fourth quarter of 2025 [19] - Management remains cautious about rate growth due to uncertainties in the policy environment but noted stable underlying rate growth [35] Other Important Information - As of March 31, 2025, the company had $91.2 million in cash and cash equivalents and approximately $900 million available under its revolving credit facility [18] - The company repurchased approximately 1.6 million shares during the first quarter for a total of $47.3 million [18] Q&A Session Summary Question: Can you provide perspective on the progression of EBITDA and seasonality this year? - Management highlighted several moving parts affecting Q1, including the timing of supplemental payments and the highest level of start-up costs, leading to a steeper ramp in EBITDA as the year progresses [25][28] Question: What are you seeing in Medicaid rate updates? - Management noted ongoing positive discussions with payer partners and maintained a conservative outlook on rate growth due to policy uncertainties, but underlying rate growth has been stable [33][35] Question: How is the broader demand environment for behavioral health? - Management indicated consistent demand for higher acuity patients across various business lines, with ongoing efforts to meet that demand through new facilities and bed additions [38] Question: What is the expected return target for new facilities? - The company applies a disciplined approach to capital deployment, ensuring that all projects meet required return thresholds, with sensitivity analyses incorporated for future projects [63][66] Question: How should we think about legal expenses moving forward? - Management is actively cooperating with ongoing investigations and anticipates that legal costs may normalize as preliminary work is completed [70][72] Question: What is happening with specialty revenue? - Management acknowledged that closures of specialty facilities have contributed to a decline in specialty revenue, but they are working to stabilize and grow this line moving forward [97][98]
Acadia Healthcare (ACHC) Beats Q1 Earnings Estimates
ZACKS· 2025-05-12 22:30
Core Viewpoint - Acadia Healthcare reported quarterly earnings of $0.40 per share, exceeding the Zacks Consensus Estimate of $0.35 per share, but down from $0.84 per share a year ago [1][2] Financial Performance - The company achieved revenues of $770.51 million for the quarter ended March 2025, aligning with the Zacks Consensus Estimate and showing a slight increase from $768.05 million year-over-year [3] - Acadia Healthcare has surpassed consensus EPS estimates three times over the last four quarters, but has only topped revenue estimates once in the same period [2][3] Stock Performance - The stock has declined approximately 39.9% since the beginning of the year, contrasting with the S&P 500's decline of 3.8% [4] - The current Zacks Rank for Acadia Healthcare is 4 (Sell), indicating expectations of underperformance in the near future [7] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is $0.77 on revenues of $852.98 million, and for the current fiscal year, it is $2.68 on revenues of $3.33 billion [8] - The trend of estimate revisions for Acadia Healthcare has been unfavorable leading up to the earnings release [7] Industry Context - The Medical - Hospital industry, to which Acadia Healthcare belongs, is currently ranked in the top 40% of over 250 Zacks industries, suggesting a favorable environment compared to the bottom 50% [9]
Acadia Healthcare(ACHC) - 2025 Q1 - Quarterly Results
2025-05-12 20:38
Financial Performance - Revenue for Q1 2025 totaled $770.5 million, a slight increase from $768.1 million in Q1 2024[8] - Adjusted EBITDA for Q1 2025 was $134.2 million, reflecting a year-over-year impact of $5 million due to the closure of one facility[8] - Net income attributable to Acadia was $8.4 million, or $0.09 per diluted share, compared to $76.4 million, or $0.83 per diluted share in Q1 2024[8][22] - Revenue for same facilities increased by 2.1% to $759,697,000 in Q1 2025 from $744,422,000 in Q1 2024[29] - Adjusted EBITDA decreased by 9.0% to $191,605,000 in Q1 2025 from $210,579,000 in Q1 2024[29] - Total facility revenue showed a slight increase of 0.3%, reaching $770,505,000 in Q1 2025 compared to $768,051,000 in Q1 2024[29] - Adjusted income attributable to Acadia Healthcare Company, Inc. was $36,929,000 in Q1 2025, down from $77,293,000 in Q1 2024[34] - Revenue per patient day slightly decreased by 0.2% to $994 in Q1 2025 from $996 in Q1 2024[29] Operational Highlights - The company added a total of 378 newly licensed beds in Q1 2025, including 90 beds to existing facilities and 288 beds to new facilities[6][8] - Acadia operates 270 behavioral healthcare facilities with approximately 12,000 beds, serving over 82,000 patients daily[16] - The company affirmed its 2025 financial guidance, projecting revenue between $3.3 billion and $3.4 billion and Adjusted EBITDA between $675 million and $725 million[13] - Acadia's strategic growth includes the addition of seven new comprehensive treatment centers, expanding its market reach to 170 CTCs across 33 states[7] Cash Flow and Capital Management - Cash and cash equivalents as of March 31, 2025, were $91.2 million, with an additional $901.6 million available under its revolving credit facility[10] - Cash provided by operating activities was $11,477,000 in Q1 2025, a recovery from a cash outflow of $321,285,000 in Q1 2024[26] - Cash paid for acquisitions in Q1 2025 was $8,594,000, down from $50,353,000 in Q1 2024[26] - The company reported a net cash increase of $14,931,000 in Q1 2025, contrasting with a decrease of $22,770,000 in Q1 2024[26] - Acadia repurchased 1,602,688 shares for a total of $47.3 million during Q1 2025[12] Costs and Expenses - Government investigations costs increased significantly to $31.011 million in Q1 2025 from $0.481 million in Q1 2024[51] - Total transaction, legal, and other costs rose to $31.072 million in Q1 2025 compared to $2.847 million in Q1 2024[51] - Termination and restructuring costs were $2.166 million in Q1 2025, a decrease from $(3.400) million in Q1 2024[51] - Legal, accounting, and other acquisition-related costs showed a net expense of $(2.105) million in Q1 2025, down from $4.757 million in Q1 2024[51] - Management transition costs were recorded at $1.009 million in Q1 2024, with no costs reported in Q1 2025[51] Tax and Adjustments - The income tax effect of adjustments to income was based on tax rates of 24.1% for Q1 2025 and 22.2% for Q1 2024[55] - The company believes that excluding certain costs from Adjusted EBITDA helps investors understand ongoing operating results better[52] - General and administrative costs are excluded from Total Facility Adjusted EBITDA to provide clearer insights into core operations[53] - The company focuses on Same Facility Adjusted EBITDA to measure financial performance of existing facilities, excluding newly developed or recently acquired facilities[54] - The company incurred debt extinguishment costs in Q1 2025 related to refinancing, which are excluded from Adjusted EBITDA[52]
Acadia Healthcare(ACHC) - 2025 Q1 - Quarterly Report
2025-05-12 20:30
Revenue Performance - Revenue for the three months ended March 31, 2025, increased by $2.5 million, or 0.3%, to $770.5 million compared to $768.1 million for the same period in 2024[111] - Same facility revenue grew by $15.3 million, or 2.1%, driven by a 2.2% increase in patient days, despite a slight decrease in revenue per patient day of -0.2%[115] - Revenue for Q1 2025 was $770.5 million, slightly up from $768.1 million in Q1 2024, with Medicaid contributing 55.9% of total revenue[130] Expenses - Salaries, wages, and benefits expense rose to $445.3 million, an increase of $27.8 million from $417.5 million in the prior year, representing 57.8% of total revenue[116] - Same facility salaries, wages, and benefits expense was $390.0 million, or 51.3% of revenue, compared to $366.3 million, or 49.2% of revenue in the previous year[116] - Professional fees remained stable at $45.7 million, accounting for 5.9% of revenue for both periods[118] - Supplies expense increased to $28.3 million, or 3.7% of revenue, compared to $26.7 million, or 3.5% of revenue in the prior year[119] - Other operating expenses increased to $114.0 million, or 14.8% of revenue, from $101.1 million, or 13.2% in Q1 2024[121] - Depreciation and amortization expenses rose to $47.0 million, representing 6.1% of revenue, up from $36.3 million, or 4.7% in Q1 2024[122] - Interest expense increased to $29.2 million in Q1 2025, compared to $27.2 million in Q1 2024, primarily due to new Senior Notes[123] Operational Growth - The company added 378 beds during the three months ended March 31, 2025, including 90 beds to existing facilities and 288 beds through new openings[109] - The company operates 270 behavioral healthcare facilities with approximately 12,000 beds across 39 states and Puerto Rico as of March 31, 2025[109] - Management expects to leverage its increased size and geographic scale to enhance patient acquisition and service offerings[110] Cash Flow and Financial Position - Cash provided by operating activities was $11.5 million in Q1 2025, a significant improvement from cash used of $321.3 million in Q1 2024[133] - Cash used in investing activities was $183.2 million in Q1 2025, primarily for capital expenditures of $174.6 million[134] - Total available cash and cash equivalents increased to $91.2 million as of March 31, 2025, from $76.3 million at December 31, 2024[136] - The summarized balance sheet as of March 31, 2025, showed total current assets of $497.8 million and total equity of $2,096.8 million[155] Debt and Financing - The company entered into a settlement agreement for $400.0 million related to the Desert Hills Litigation, fully resolving the claims[137] - The Credit Facility includes a $1.0 billion Revolving Facility and a $650.0 million Term Loan Facility, both maturing on February 28, 2030[138] - As of March 31, 2025, the Consolidated Total Net Leverage Ratio was 3.2x, compliant with the financial covenants of a maximum of 5.0x[144] - During the three months ended March 31, 2025, the company borrowed $645.0 million on the Revolving Facility and repaid $550.0 million[145] - The company had $901.6 million of availability under the Revolving Facility as of March 31, 2025[145] - Long-term debt as of March 31, 2025, was $2,184.3 million, an increase from $1,880.1 million as of December 31, 2024[155] - A hypothetical 1% increase in interest rates would decrease pretax income by approximately $7.2 million annually, given the long-term debt composition of $1,460.3 million fixed-rate and $724.0 million variable-rate[159] - The company recorded a loss on extinguishment of $1.3 million related to the refinancing of the Prior Credit Facility[148] - Total obligations and commitments as of March 31, 2025, amounted to $3,105.3 million, including long-term debt and lease liabilities[156] - The company issued $550.0 million of 7.375% Senior Notes due 2033 to pay down outstanding borrowings under the Revolving Facility[151]
Will Rising Expenses Hurt Acadia Healthcare's Q1 Earnings?
ZACKS· 2025-05-08 16:35
Core Viewpoint - Acadia Healthcare Company, Inc. (ACHC) is expected to report first-quarter 2025 results on May 12, with earnings estimated at 42 cents per share and revenues at $770.5 million, indicating a year-over-year earnings decline of 50% but a slight revenue growth of 0.3% [1][2]. Financial Estimates - First-quarter earnings estimates have declined by 8 cents per share over the past 60 days, reflecting a significant year-over-year decrease [2]. - For the full year 2025, the revenue estimate for Acadia Healthcare is $3.33 billion, representing a year-over-year increase of 5.7%, while the EPS estimate is $2.76, indicating a decline of 16.4% year-over-year [2]. Recent Performance - Acadia Healthcare has beaten earnings estimates in three of the last four quarters, with an average surprise of negative 0.4% [3]. Earnings Prediction Model - The current model does not predict an earnings beat for Acadia Healthcare, as it has an Earnings ESP of 0.00% and a Zacks Rank of 4 (Sell) [4]. Revenue Drivers - Revenue per patient day is estimated to rise by 2% year-over-year, and revenues from Residential Treatment Centers are expected to increase by 9.7% from $85.6 million a year ago [6]. - U.S. same-facility admissions are projected to show a marginal increase, while revenues from Specialty Treatment Facilities are expected to rise by 0.1% from $143.8 million [7]. Expense Concerns - Rising expenses are anticipated to impact profit levels, with total expenses expected to increase by more than 11% due to higher salaries, wages, benefits, and other operating costs [8]. - Supply costs are also expected to rise due to increased utilization [8]. Revenue Declines in Specific Areas - Revenues from Acute Inpatient Psychiatric Facilities are projected to decrease by 1.3% from $401.1 million, and same-facility patient days are expected to decline by 1.1% year-over-year [9]. - Comprehensive Treatment Centers' revenues are estimated to fall by 0.5% from $132.2 million [9].
New Strong Sell Stocks for April 4th
ZACKS· 2025-04-04 08:05
Group 1 - Acadia Healthcare Company, Inc. (ACHC) has been added to the Zacks Rank 5 (Strong Sell) List due to a 17.4% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Blackbaud, Inc. (BLKB) is also on the Zacks Rank 5 (Strong Sell) List, with a 6.7% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Cable One, Inc. (CABO) has been included in the Zacks Rank 5 (Strong Sell) List, with an 8.5% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2]