One-glance verdict
Within fair range
$67.13 our estimate vs market $27.68
Wall Street consensus: $33.57 (-50.0% lower than our fair-value estimate)
59% below our estimate
Fundamentals snapshot
Acadia Healthcare Company, Inc.
ACHC · NMS · Healthcare · Medical Care Facilities
Current price
$27.68
52-week range
$11.43 - $35.83
Market cap
$2.58B
Balance sheet
Stretched
2.79x Stretched
Net debt $2.42B. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
3 Risks
2 rewards · 3 risks
- Reward Revenue grew 1.8% last year.
- Reward Free cash flow was positive in 8/10 years.
- Risk Net debt grew 75.3% over 3 years.
- Risk Return on equity was -41.4% last year — the company lost money on shareholders' equity.
What this company does
Acadia Healthcare Company, Inc.
Acadia Healthcare runs hospitals and clinics that provide mental health and addiction treatment services across the United States and Puerto Rico. The company makes money by billing patients and their insurance for everything from inpatient stays to outpatient therapy sessions. Its financial performance depends on the continuous demand for these specialized healthcare services and its ability to get paid well by insurance providers.
How the company got here
Acadia Healthcare was started in 2005 to build a large-scale business in the fragmented behavioral healthcare industry. A key turning point was in 2011 when it merged with a publicly traded company, which gave it better access to money for growth. The company grew significantly by acquiring other healthcare facility companies, including a large expansion into the United Kingdom. In 2021, Acadia sold its U.K. operations to focus solely on the U.S. market, where it continues to expand by building new facilities and partnering with non-profit hospital systems.
What it actually does
Acadia Healthcare provides services for people dealing with mental health issues and addiction. It operates a large network of facilities, including inpatient psychiatric hospitals, residential treatment centers, and outpatient clinics across the United States and Puerto Rico. Think of it as a system of specialized hospitals and clinics that offer different levels of care, from 24/7 hospital stays for serious conditions to less intensive outpatient programs where patients visit for therapy and support. The company's goal is to provide a range of treatment options to help individuals on their path to recovery.
Acute Inpatient Psychiatric Facilities
This is Acadia's largest business area, making up more than half of its revenue. These are hospitals where adults, adolescents, and sometimes children with serious psychiatric conditions can stay to receive intensive, 24-hour care. Patients are admitted for stabilization during a mental health crisis. The primary customers paying for these services are government programs like Medicaid (a government insurance program for low-income individuals and families) and Medicare (a federal health insurance program for people who are 65 or older and certain younger people with disabilities), as well as private insurance companies.
Specialty Treatment Facilities
This segment provides specialized care for issues like eating disorders and substance abuse in a residential setting, meaning patients live at the facility during treatment. These facilities offer focused programs that are more intensive than typical outpatient care. This part of the business generates a smaller portion of the company's total revenue than the acute inpatient facilities. Payment for these services comes from a mix of commercial insurance providers, government payers, and individuals paying out-of-pocket.
Comprehensive Treatment Centers (CTCs)
These are outpatient clinics focused on treating opioid addiction. Patients visit these centers to receive medication-assisted treatment, like methadone, combined with counseling and other support services. This is a significant and growing part of Acadia's business, representing a similar share of revenue as its specialty treatment facilities. The main payers are government programs, particularly Medicaid, which has expanded its coverage for these types of services.
Residential Treatment Centers (RTCs)
These centers offer longer-term care for individuals, including adolescents, with mental health and addiction disorders who need a structured and supportive environment to receive comprehensive therapy. Unlike a hospital, these facilities are designed for extended stays. This is the smallest of Acadia's main business lines in terms of revenue. Similar to its other services, payment comes from insurance reimbursements and direct payments from patients.
What management is betting on now
Management's current focus is on expanding access to care to meet strong demand for behavioral health services. They are doing this by adding more beds to existing facilities, building new hospitals, and forming joint ventures (partnerships with other healthcare systems to operate facilities together). A key priority is to make the thousands of new beds added in recent years profitable by getting them accredited, contracting with insurers, and increasing the number of patients they serve. The company is also focused on improving its operations to become more efficient and using data to negotiate better payment rates from insurance companies.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$16.91M
FY2024 Q3
$-27.11M
FY2024 Q4
$-86.79M
FY2025 Q1
$-163.15M
FY2025 Q2
$-34.24M
FY2025 Q3
$-63.03M
FY2025 Q4
$-179.48M
FY2026 Q1
$-15.03M
Revenue
$828.80M
Net income
$4.11M
Diluted EPS
0.05
Operating cash flow
$61.53M
Free cash flow
$-15.03M
Fetching…
Sources
Revenue
$821.46M
Net income
$-1.18B
Diluted EPS
-12.98
Operating cash flow
$-86.29M
Free cash flow
$-179.48M
Fetching…
Sources
Revenue
$851.57M
Net income
$36.25M
Diluted EPS
0.40
Operating cash flow
$73.21M
Free cash flow
$-63.03M
Fetching…
Sources
Revenue
$869.23M
Net income
$30.13M
Diluted EPS
0.33
Operating cash flow
$133.50M
Free cash flow
$-34.24M
Fetching…
Sources
Revenue
$770.50M
Net income
$8.37M
Diluted EPS
0.09
Operating cash flow
$11.48M
Free cash flow
$-163.15M
Fetching…
Sources
Revenue
$774.24M
Net income
$32.62M
Diluted EPS
0.36
Operating cash flow
$116.70M
Free cash flow
$-86.79M
Fetching…
Sources
Revenue
$815.63M
Net income
$68.13M
Diluted EPS
0.74
Operating cash flow
$163.13M
Free cash flow
$-27.11M
Fetching…
Sources
Revenue
$796.04M
Net income
$78.48M
Diluted EPS
0.85
Operating cash flow
$171.15M
Free cash flow
$16.91M
Fetching…
Sources
Is it cheap or expensive?
Fair value $67.13 vs current price $27.68
Wall Street consensus is the average analyst price target: $33.57 (-50.0% lower than our fair-value estimate).
Our most-likely fair value is $67.13 a share — about 142.5% away from today's price of $27.68, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $2.4B. Interest coverage 2.8x.
Net debt
$2.42B
Interest coverage
2.79x
Acadia Healthcare Company, Inc. is healthier than 0 of 1 peers on balance-sheet leverage.
Stretched
Worse cushion
Baseline
Better cushion
ACHC
BASELINE
Acadia Healthcare Company, Inc.
Total debt $2.59B Interest coverage 2.79x This is the baseline the peer rows are being compared against.
What you should know
The case for and against ACHC
2 Rewards
3 Risks
Rewards
-
Revenue grew 1.8% last year.
-
Free cash flow was positive in 8/10 years.
Risks
-
Net debt grew 75.3% over 3 years.
-
Return on equity was -41.4% last year — the company lost money on shareholders' equity.
-
Operating margin compressed from 17.9% to 10.1% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
—
Forward P/E
15.19x
P/B
1.27x
P/S
0.77x
EV/EBITDA
9.79x
PEG ratio
1.37x
Profitability
How much profit each dollar creates
Gross margin
41.1%
Operating margin
10.1%
Net margin
-33.4%
ROE
-41.4%
ROA
3.6%
Health
Liquidity and balance-sheet strength
Debt / equity
1.18x
Current ratio
1.57x
Quick ratio
1.35x
Total debt
$2.59B
Total cash
$171.29M
Growth
How the business has been compounding
Revenue TTM
$3.37B
Revenue 5Y CAGR
9.4%
EPS TTM
-12.42
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$181.95M
Free CF TTM
$-439.91M
FCF margin
-13.0%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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