Acadia Healthcare (ACHC) Down 3.3% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for Acadia Healthcare (ACHC). Shares have lost about 3.3% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Acadia Healthcare due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Acadia Healthcare's Q3 Earnings Beat Estimates

Acadia Healthcare reported adjusted third-quarter earnings of 91 cents per share, which beat the Zacks Consensus Estimate by 1.1%. The bottom line was flat year over year.

Total revenues increased 8.7% year over year to $815.6 million. The top line missed the consensus mark by a whisker.

The third-quarter earnings benefited from improved volumes and higher patient days.

Q3 Operations

Same-facility revenues of $802.6 million rose 8.6% year over year but fell short of our estimate of $808.6 million. The year-over-year improvement was driven by 3.6% growth in revenue per patient day and a 4.7% increase in patient days.

Admissions grew 2% year over year. The average length of stay grew 2.7% year over year but missed our growth estimate of 3%.

In the overall facility, patient days improved 4.6% year over year while admissions grew 2.4% year over year. Revenue per patient day improved 3.9% year over year, which was higher than our growth estimate of 2.6%. The average length of stay rose 2.1% year over year but lagged our growth estimate of 3.5%.

Adjusted EBITDA climbed 10.5% year over year to $194.3 million but came lower than our estimate of $195.4 million. Adjusted EBITDA margin deteriorated 50 bps year over year to 28.2%. 

Total expenses of $717.1 million declined 30.9% year over year but higher than our estimate of $699.1 million. The year-over-year decrease was due to a legal settlements expense cost recognized in the prior-year quarter and lower transaction, legal and other costs.

Financial Update (as of Sept. 30, 2024)

Acadia Healthcare exited the third quarter with cash and cash equivalents of $82.1 million, which decreased 17.9% from the 2023-end level. It had a leftover capacity of $321.5 million under its $600 million revolving credit facility at the third-quarter end.

Total assets of $5.9 billion increased 9.5% from the figure at 2023-end.

Long-term debt amounted to $1.8 billion, which escalated 34.4% from the figure as of Dec. 31, 2023. The current portion of long-term debt was $71.7 million.

Total equity of $3 billion increased 9% from the 2023-end level. The net leverage ratio was around 2.5X at the third-quarter end.

Net cash provided by operations totaled $13 million in the first nine months of 2024 against $346 million in the prior-year comparable period.