Ensign Group Bolsters Healthcare Portfolio With Nine New Facilities

Acquisition Details - The Ensign Group Inc (ENSG) recently acquired the operations of eight skilled nursing facilities in Tennessee and one in Alabama, marking its entry into Alabama [1] - The Tennessee facilities are Meadowbrook Healthcare and Rehabilitation Center (83 beds), Wellpark Health and Rehabilitation (30 beds), Legacy Park Health and Rehabilitation (176 beds), VanAyer Senior Living and Rehabilitation (91 beds), Union City Health and Rehabilitation (115 beds), Decatur County Healthcare (125 beds), Savannah Nursing and Rehabilitation (120 beds), and Westwood Nursing and Rehabilitation (90 beds) [2] - The Alabama facility, The Health Center at Research Park, contains 91 beds [2] - Six of these facilities are co-owned by CareTrust REIT Inc (CTRE) and a joint venture investor, operating under a new long-term triple-net master lease with ENSG-affiliated operating companies starting from 2025 [3] - The remaining three facilities were acquired by Ensign Group's real estate subsidiary, Standard Bearer Healthcare REIT [3] Portfolio and Operations - Post-acquisition, ENSG's portfolio comprises 333 healthcare operations across 15 states, with 30 offering senior living services [4] - Through subsidiaries including Standard Bearer, ENSG owns 129 real estate assets and operates 96 of them [4] - The company aims to gain an in-depth understanding of local communities by working closely with caregivers at the acquired facilities, enabling high-quality care for residents and their families [4] Expansion Strategy - The latest acquisition marks ENSG's first expansion initiative for 2025, following an active year of buyouts in 2024 [5] - Management focuses on opportunistic real-estate buyouts and leasing struggling skilled nursing, senior living, and other healthcare-linked businesses across the US [6] - Frequent expansions allow the company to deepen its presence in underserved communities and address inadequate care access [5] Financial and Market Performance - The Skilled Services segment, which generates income from Medicaid, Medicare, managed care, and private payors, saw revenues rise 8.4% year-over-year in the first nine months of 2024 [7] - ENSG's share price gained 16.7% in the past year, outperforming the industry's 9.3% growth [8] - The company currently carries a Zacks Rank 2 (Buy) [8] Industry Comparison - Other top-ranked stocks in the Medical space include Doximity Inc (DOCS) and Inspire Medical Systems Inc (INSP), both sporting a Zacks Rank 1 (Strong Buy) [10] - Doximity's earnings surpassed estimates in the last four quarters, with an average surprise of 22.12%, and its 2025 earnings and revenue estimates indicate a 10% rise from 2024 [11] - Inspire Medical Systems' earnings outpaced estimates in the trailing four quarters, with an average surprise of 649.90%, and its 2025 earnings and revenue estimates indicate a 53.6% and 19% rise, respectively, from 2024 [12] - Shares of Doximity and Inspire Medical Systems gained 92.6% and 14.6%, respectively, in the past year [13]