Core Insights - BrightSpring Health Services, Inc. (BTSG) is currently rated as a Strong Buy (1) while Medpace (MEDP) is rated as a Buy (2), indicating a more favorable earnings outlook for BTSG [3] - Value investors utilize various traditional metrics to identify undervalued stocks, including P/E ratio, P/S ratio, earnings yield, and cash flow per share [4] Valuation Metrics - BTSG has a forward P/E ratio of 30.66, compared to MEDP's forward P/E of 40.04, suggesting that BTSG may be undervalued relative to MEDP [5] - The PEG ratio for BTSG is 0.58, indicating a more attractive growth valuation compared to MEDP's PEG ratio of 2.71 [5] - BTSG's P/B ratio stands at 3.23, significantly lower than MEDP's P/B ratio of 56.81, further supporting the argument for BTSG's better valuation [6] Conclusion - Given the stronger estimate revision activity and more attractive valuation metrics, BTSG is positioned as the superior investment option for value investors at this time [7]

Core Insights - The Russell 2000 index features high-growth potential stocks but requires careful selection due to the inherent risks associated with smaller companies [1][2] Company Summaries The Marzetti Company (MZTI) - Market Cap: $4.73 billion - Known for frozen garlic bread and other food products, MZTI trades at $172.14 per share with a forward P/E of 24.1 [3][5] BrightSpring Health Services (BTSG) - Market Cap: $6.76 billion - Offers a range of health services including home health care and hospice, trading at $32.60 per share with a forward P/E of 26.7 [6][8] Westamerica Bancorporation (WABC) - Market Cap: $1.19 billion - Provides banking services across Northern and Central California, facing several challenges including slow growth and declining profitability metrics [9] Concerns Regarding Companies The Marzetti Company (MZTI) - Specific concerns about MZTI are not detailed in the provided content [4] BrightSpring Health Services (BTSG) - Specific concerns about BTSG are not detailed in the provided content [7] Westamerica Bancorporation (WABC) - Annual net interest income growth of 6.2% over the last five years is slower than peers [10] - Revenue growth of 4% annually over the last three years indicates demand lagging behind consumer staples [10] - Estimated sales growth of 1.8% for the next 12 months suggests a slowdown in demand [10] - Gross margin of 23.4% is inferior due to competition and product substitution [10] - Earnings per share have decreased by 46% annually over the past four years, raising concerns about long-term stock price trends [11] - Investment activity has increased, putting pressure on a weak free cash flow margin of 1.3% [11] - Return on invested capital (ROIC) of 3.9% indicates management challenges in finding attractive investment opportunities [11] - Estimated net interest income decline of 11% for the next 12 months points to a challenging demand environment [12] - Net interest margin has shrunk by 46.7 basis points over the last two years, indicating decreasing profitability or increased competition [12]

Financial Data and Key Metrics Changes - BrightSpring reported total revenue of $3.3 billion for Q3 2025, representing a 28% year-over-year growth [9][24] - Adjusted EBITDA for the quarter was $160 million, an increase of 37% compared to the same period last year, with an EBITDA margin of 4.8% [9][26] - Cash flow from operations exceeded $100 million in Q3, with leverage declining to 3.3x [10][27] Business Line Data and Key Metrics Changes - Pharmacy Solutions revenue was $3.0 billion, growing 31% year-over-year, while Provider Services revenue reached $367 million, increasing 9% year-over-year [9][24] - Within Pharmacy Solutions, infusion and specialty revenue was $2.4 billion, reflecting a 42% growth from the prior year, while home and community pharmacy revenue was approximately flat at $590 million [24][26] - Provider Services segment adjusted EBITDA grew 16%, with home healthcare revenue increasing 12% year-over-year [18][24] Market Data and Key Metrics Changes - Home healthcare average daily census was 29,592, representing a 3% increase year-over-year, with hospice revenue increasing approximately 15% [18][19] - Specialty pharmacy scripts grew approximately 40% in Q3, driven by strong performance in both brand limited distribution drugs (LDDs) and generics [15][16] Company Strategy and Development Direction - BrightSpring aims to leverage its scaled platform in home and community healthcare to differentiate itself in the market [7] - The company is focused on quality and continuous improvement, with high patient satisfaction scores across service lines [11][12] - Future growth strategies include expanding chronic infused therapy offerings and optimizing go-to-market strategies in pharmacy [17][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ongoing operational execution and continuous improvement driving financial results [8] - The company anticipates closing the community living divestiture transaction in Q1 2026, which is subject to regulatory approvals [8][10] - Management expects to achieve adjusted EBITDA guidance of $605 million-$615 million for 2025, reflecting a growth of 31.5%-33.7% over 2024 [30] Other Important Information - BrightSpring will host an Investor Day on March 17 in Louisville to discuss company strategy and service line prospects [21][22] - The company is implementing operational initiatives to enhance efficiency and has seen positive impacts from targeted growth investments [25][88] Q&A Session Summary Question: On the pacing of new drug launches - Management confirmed that the pipeline remains robust, with expectations of 16 to 18 launches over the next 12 to 18 months [32][33] Question: Sources of accretion for the Amedisys transaction - Management indicated that integration of operations and applying best practices will drive incremental margin and profit [41][42] Question: EBITDA per script increase sustainability - Management noted that higher growth in specialty scripts, which have the highest gross profit, contributed to the increase [44][45] Question: Impact of community living divestiture delay - Management stated that the delay is due to regulatory processes but remains optimistic for a Q1 closure [71] Question: Future opportunities in specialty pharmacy - Management highlighted ongoing focus on rare and orphan therapies and the growth potential in both acute and chronic therapies [94][95]

Financial Data and Key Metrics Changes - For Q3 2025, total company revenue was $3.3 billion, representing a 28% increase year over year, with adjusted EBITDA growing approximately 37% to $160 million [9][24][27] - EBITDA margin improved to 4.8%, up 30 basis points compared to the previous year [9][26] - Cash flow from operations exceeded $100 million, and leverage ratio declined to 3.3 times, with a target of 3 times by year-end [10][27] Business Line Data and Key Metrics Changes - Pharmacy Solutions revenue was $3.0 billion, a 31% increase year over year, while Provider Services revenue was $367 million, growing 9% [9][24] - Within Pharmacy Solutions, infusion and specialty revenue reached $2.4 billion, up 42% year over year, while home and community pharmacy revenue was approximately flat at $590 million [24][26] - Provider Services segment adjusted EBITDA grew 16% to $61 million, with home healthcare revenue increasing 12% [18][24] Market Data and Key Metrics Changes - Home healthcare average daily census increased by 3% year over year, with hospice revenue growing approximately 15% [18][19] - Specialty pharmacy scripts grew approximately 40% in Q3, driven by strong performance in both brand limited distribution drugs (LDDs) and generics [15][16] - Home and community pharmacy demonstrated 99.5% order completeness and on-time delivery of 97.2% [12] Company Strategy and Development Direction - The company is focused on quality and continuous improvement, aiming to deliver low-cost, patient-centric care [11][22] - Plans to close the community living divestiture transaction in Q1 2026, which is expected to enhance operational focus [8][29] - The company is optimistic about expanding its presence in targeted markets and enhancing operational efficiency through automation and AI initiatives [84][93] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing growth trajectory, with expectations for continued strong performance in Q4 2025 [10][29] - The company anticipates a positive impact from recent investments in home health, hospice, and rehab services [25][84] - Management remains focused on maintaining high-quality service levels and patient satisfaction across all service lines [11][12] Other Important Information - The company plans to host an Investor Day on March 17 in Louisville to discuss strategy and service line prospects [21] - The adjusted EPS for Q3 was $0.30, reflecting strong operational performance [25] Q&A Session Summary Question: On the pacing of new drug launches - Management confirmed that the pipeline remains robust, expecting 16 to 18 launches over the next 12 to 18 months, with a strong year for brand wins [31][32] Question: On the Amedisys and LHC Home Health Branch acquisitions - Management indicated that the transaction is expected to be accretive in 2026, with integration plans focusing on operational efficiencies [34][36] Question: Sources of accretion from acquisitions - Management highlighted the integration of operations and potential synergies in technology and payer contracts as key sources of incremental margin [40][42] Question: On the sustainability of EBITDA per script growth - Management noted that the increase in EBITDA per script is driven by higher growth in specialty scripts, which have higher gross profit margins [43][45] Question: Impact of community living divestiture delay - Management explained that the delay is due to regulatory processes but remains optimistic for a Q1 closure [68] Question: Future opportunities in specialty pharmacy - Management emphasized ongoing focus on rare and orphan therapies, with expectations for continued growth in the specialty and infusion segments [90][92]

Financial Data and Key Metrics Changes - BrightSpring Health Services reported total revenue of $3.3 billion for Q3 2025, representing a 28% increase year over year [6][21] - Adjusted EBITDA for the quarter was $160 million, reflecting a 37% growth compared to the same period last year [7][24] - The EBITDA margin improved to 4.8%, up approximately 30 basis points year over year [7][24] - Cash flow from operations exceeded $100 million in Q3, with a leverage ratio of 3.3 times at the end of the quarter [8][25] Business Line Data and Key Metrics Changes - Pharmacy Solutions revenue was $3.0 billion, increasing 31% year over year, while Provider Services revenue was $367 million, growing 9% year over year [7][22] - Within Pharmacy Solutions, infusion and specialty revenue reached $2.4 billion, a 42% increase from the prior year, while home and community pharmacy revenue was approximately flat at $590 million [21][22] - Provider Services segment adjusted EBITDA grew 16% to $61 million, with a margin of 16.5%, up 90 basis points year over year [24][16] Market Data and Key Metrics Changes - Home healthcare revenue grew 12% year over year, with an average daily census of 29,592, representing a 3% increase [16][17] - Hospice services saw a 15% increase in revenue year over year, maintaining a high-quality rating [10][16] - The company reported strong growth in specialty scripts, with a 40% increase in Q3, driven by limited distribution drug launches [12][39] Company Strategy and Development Direction - BrightSpring Health Services aims to enhance its position in home and community healthcare, focusing on quality and operational efficiency [5][19] - The company is pursuing acquisitions, including Amedisys and LHC Home Health Branch, expected to close in Q4 2025, which will be neutral to 2025 results but accretive in 2026 [9][33] - The strategy includes expanding into new geographic markets and enhancing chronic therapy offerings [15][80] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing growth trajectory, with expectations for continued strong performance in Q4 2025 [19][72] - The company anticipates achieving a leverage ratio below 3.0 times by year-end, reflecting improved cash flow and operational efficiency [25][74] - Management highlighted the importance of quality metrics and patient satisfaction, which remain high across service lines [10][19] Other Important Information - The community living divestiture is expected to close in Q1 2026, pending regulatory approvals [6][9] - The company is focused on continuous improvement and operational efficiencies, with a new CTO leading AI initiatives [72][80] Q&A Session Summary Question: On the pacing of new drug launches - Management confirmed that the pipeline remains robust, with expectations for 16 to 18 launches over the next 12 to 18 months [30][31] Question: Sources of accretion for the Amedisys transaction - Management indicated that integration will focus on operational efficiencies and leveraging existing practices [34][36] Question: Accretion impact for 2026 - Management stated that the transaction is expected to be accretive in 2026 [33] Question: Growth drivers for specialty pharmacy - Management highlighted strong growth in specialty scripts and the potential for further growth in the infusion market [78][80] Question: Update on M&A pipeline - Management confirmed focus on small, accretive tuck-in deals, with no imminent large transactions [56][57] Question: Impact of community living divestiture delay - Management noted that the process can take time, but they remain optimistic for a Q1 close [61] Question: Future opportunities in pharmacy solutions - Management emphasized growth in rare and orphan therapies, as well as operational efficiencies through automation [78][80]

Revenue Growth - Revenue increased by $732.9 million, or 28.2%, to $3,334.1 million in Q3 2025 compared to Q3 2024[149] - Pharmacy Solutions segment revenue grew by $701.3 million, or 31.0%, to $2,967.0 million, while Provider Services segment revenue increased by $31.6 million, or 9.4%, to $367.1 million[149] - Total revenues for the three months ended September 30, 2025, were $3,334.1 million, an increase of $732.9 million or 28.2% compared to $2,601.2 million for the same period in 2024[187] - Total revenues for the nine months ended September 30, 2025, were $9,359.9 million, an increase of $2,034.7 million or 27.8% compared to $7,325.2 million for the same period in 2024[200] - Revenues for the Pharmacy Solutions segment reached $8,289.2 million for the nine months ended September 30, 2025, an increase of $1,932.0 million or 30.4% compared to $6,357.2 million in 2024[223] Profitability - Net income rose by $63.2 million from a net loss of $25.7 million to a net income of $37.5 million[149] - Adjusted EBITDA increased by $43.5 million, or 37.2%, to $160.4 million[149] - Gross profit for the three months ended September 30, 2025, was $392.0 million, reflecting a 21.3% increase from $323.1 million in the prior year[186] - Net income for the nine months ended September 30, 2025, was $55.2 million, a significant increase of $128.5 million compared to a net loss of $73.2 million for the same period in 2024[207] - Adjusted EBITDA rose to $434.0 million for the nine months ended September 30, 2025, reflecting an increase of $104.2 million or 31.6% from $329.8 million in 2024[208] Segment Performance - Pharmacy Solutions segment EBITDA increased by $41.8 million, or 42.2%, to $141.0 million[157] - Provider Services segment EBITDA grew by $8.4 million, or 16.0%, to $60.7 million[157] - Segment operating income for the three months ended September 30, 2025, was $53.3 million, reflecting a 15.9% increase from $46.0 million in 2024[231] - Segment EBITDA for the nine months ended September 30, 2025, was $381.4 million, up $99.6 million or 35.3% from $281.8 million in 2024[230] Cash Flow and Liquidity - Net cash provided by operating activities for the nine months ended September 30, 2025, was $258.6 million, a substantial increase of $325.4 million compared to a cash outflow of $66.8 million in 2024[262] - Total liquidity at the end of September 30, 2025, was $617.6 million, up from $475.8 million at the end of 2024, showing improved financial flexibility[260] - Net cash used in investing activities decreased by $53.3 million, from $124.5 million in 2024 to $71.2 million in 2025, primarily due to reduced cash paid for acquisitions[263] Debt and Interest - The total outstanding debt of the Company as of September 30, 2025, was $2.58 billion, with a net debt of $2.52 billion after accounting for debt issuance costs[281] - The Company's leverage ratio was 3.31x as of September 30, 2025, down from 4.16x at December 31, 2024[281] - Interest expense, net for the three months ended September 30, 2025, decreased to $38.2 million, down $8.4 million or 18.0% from $46.6 million in the prior year[192] - The Company incurred a loss on extinguishment of debt of $12.7 million related to the repayment of the $450.0 million Second Lien Facility[278] Strategic Initiatives - The divestiture of the Community Living business is expected to close in Q1 2026 for $835 million, enhancing strategic focus and operational efficiencies[145] - The company has expanded its service offerings and footprint to serve patients in home settings, addressing a significant national healthcare need[163] - The company has entered into several accountable care organization (ACO) arrangements to participate in shared savings from attributed primary care patients[173] - The pharmacy solutions tailored for home environments are projected to grow faster than the overall pharmacy market, indicating a strategic growth area for the company[159] Market and Patient Metrics - The Company serves over 460,000 patients daily through approximately 10,500 clinical providers and pharmacists across all 50 states[144] - The patient census for pharmacy services grew approximately 2% in Q3 2025 compared to Q3 2024, indicating continued demand in home and community-based settings[161] - Prescriptions dispensed in the Pharmacy Solutions segment increased to 32,522,286 for the nine months ended September 30, 2025, a growth of 1,673,165 or 5.4% from 30,849,121 in 2024[222] - Revenue per prescription dispensed increased to $254.88 for the nine months ended September 30, 2025, up $48.81 or 23.7% from $206.07 in 2024[222]

Third Quarter 2025 Earnings Presentation October 28, 2025 1 Forward-Looking Statements; Non-GAAP Financial Information Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, our operations and financial performance. Forward-looking statements include all statements that are not historical facts. These forward-l ...

Core Insights - BrightSpring Health Services reported strong financial results for Q3 2025, with total revenue reaching $3,334 million, a 28% increase from $2,601 million in Q3 2024 [4][3] - The company has increased its revenue guidance for 2025, projecting revenues between $12,500 million and $12,800 million, representing a growth of 24.1% to 27.1% compared to 2024 [4][3] - Adjusted EBITDA for Q3 2025 was $160 million, up 37.2% from $117 million in Q3 2024, indicating strong operational performance [4][3] Financial Performance - Pharmacy Solutions revenue for Q3 2025 was $2,967 million, a 31% increase from $2,266 million in Q3 2024, while Provider Services revenue increased by 9% to $367 million [3][4] - Gross profit for Q3 2025 was $392 million, up 21.3% from $323 million in Q3 2024, reflecting improved cost management [4][3] - The net income for Q3 2025 was $37.5 million, a significant turnaround from a net loss of $25.7 million in Q3 2024 [4][3] Business Metrics - The company dispensed 10,793,219 prescriptions in Q3 2025, a slight decrease of 1% from 10,874,429 in Q3 2024, but revenue per script increased by 32% to $274.89 [6][4] - The average daily census for Home Health Care increased by 3% to 29,592 in Q3 2025 compared to 28,650 in Q3 2024 [6][4] - The number of Rehab Care persons served rose by 11% to 7,321 in Q3 2025, indicating growth in service demand [6][4] Strategic Developments - The planned divestiture of the Community Living business to Sevita is expected to close in Q1 2026, which may impact future financial results [4][3] - The company has repurchased 1,500,000 shares as part of a secondary offering, indicating confidence in its stock value [4][3] - BrightSpring continues to focus on delivering high-quality, patient-centric care while leveraging its scale to improve operational efficiency [2][3]

Core Viewpoint - BrightSpring Health Services, Inc. is conducting a secondary offering of 15,000,000 shares of common stock, with no shares being sold by the company itself, and the proceeds will go entirely to the selling stockholders [1] Group 1: Offering Details - The offering is expected to close on October 22, 2025, subject to customary closing conditions [1] - The company has authorized the concurrent purchase of 1,500,000 shares from the underwriter at the same price per share as the offering, with the repurchase closing simultaneously with the offering [2] - BofA Securities is acting as the sole book-running manager for the offering, which will be sold at market prices or negotiated prices [3] Group 2: Regulatory Information - A shelf registration statement relating to these securities was filed with the SEC on June 10, 2025, and became effective upon filing [4] - The offering will be made only by means of a prospectus supplement and accompanying prospectus [5]

Core Insights - BrightSpring Health Services, Inc. (BTSG) reported quarterly earnings of $0.3 per share, exceeding the Zacks Consensus Estimate of $0.27 per share, and showing significant growth from $0.11 per share a year ago, resulting in an earnings surprise of +11.11% [1] - The company achieved revenues of $3.33 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 5.46% and increasing from $2.91 billion year-over-year [2] - BrightSpring Health Services has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] Earnings Performance - The company has shown a strong performance with a year-to-date stock increase of approximately 74.6%, compared to the S&P 500's gain of 13.3% [3] - The current consensus EPS estimate for the upcoming quarter is $0.34, with expected revenues of $3.31 billion, and for the current fiscal year, the EPS estimate is $1.10 on revenues of $12.5 billion [7] Industry Outlook - The Medical Services industry, to which BrightSpring belongs, is currently ranked in the top 36% of over 250 Zacks industries, indicating a favorable outlook [8] - The performance of BrightSpring's stock may be influenced by the overall industry outlook, as research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8] Future Expectations - The sustainability of the stock's price movement will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The estimate revisions trend for BrightSpring was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6]