One-glance verdict
Undervalued
$199.93 our estimate vs market $125.54
Wall Street consensus: $134.08 (-32.9% lower than our fair-value estimate)
37% below our estimate, below the bear case
Fundamentals snapshot
Addus HomeCare Corporation
ADUS · NMS · Healthcare · Medical Care Facilities
Current price
$125.54
52-week range
$87.95 - $126.62
Market cap
$2.34B
Balance sheet
Healthy
10.18x Adequate
Net debt $9.25M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Revenue grew 3.8% last year.
- Reward Free cash flow was positive in 9/10 years.
- Reward Trades at 22.0x P/E vs peer median 24.1x (8.8% cheaper).
What this company does
Addus HomeCare Corporation
Addus HomeCare Corporation helps people who need assistance at home with everyday tasks like bathing, eating, and getting around, and also provides end-of-life hospice care and medical support after hospital stays. The money they make comes from government programs, insurance companies, and individuals paying for these services, which is important because it shows how much people rely on their help for care that isn't in a hospital.
How the company got here
Addus HomeCare started in 1979 as a small service focused on helping seniors and people with disabilities remain in their homes by providing non-medical assistance with daily tasks. Initially, it offered basic chore and cleaning services, funded by programs like Medicaid. Over time, the company grew, eventually going public in 2009, which provided capital for expansion. A significant shift occurred in the late 2010s and early 2020s, with Addus strategically acquiring companies to broaden its services beyond personal care into hospice and home health. This expansion transformed Addus into a more comprehensive home-based care provider, aiming to offer a full spectrum of services to a growing elderly population.
What it actually does
Addus HomeCare provides essential support services that allow individuals, primarily the elderly, chronically ill, or disabled, to live independently in their own homes. Instead of requiring hospitalization or moving into a care facility, people receive help with daily living activities, medical care, and end-of-life support right where they are. The company works with various government agencies, insurance providers, and private individuals to deliver these services, acting as a crucial link in the healthcare system by keeping people comfortable and cared for at home.
Personal Care
This is the largest part of Addus HomeCare's business, making up about three-quarters of its revenue. The Personal Care segment offers non-medical assistance to help people with their everyday activities. This includes things like bathing, dressing, eating, light housekeeping, and transportation. The primary customers for these services are individuals who need ongoing support to live independently, and they are often funded through government programs like Medicaid or by private pay. This segment focuses on building long-term relationships with clients by providing consistent, daily support.
Hospice
The Hospice segment provides care for individuals who are terminally ill, focusing on comfort and quality of life rather than a cure. This involves offering medical support, pain management, emotional and spiritual counseling for both the patient and their family. Hospice services are typically paid for by Medicare, a government health insurance program for seniors. This segment represents a significant portion of Addus's business, about 18% of its revenue, and it allows the company to offer more advanced clinical care.
Home Health
This segment, which is the smallest part of Addus HomeCare's business at around 5% of revenue, offers skilled medical services. This includes services like nursing care and physical, occupational, or speech therapy. These services are usually provided for shorter periods, often after a hospitalization or during recovery from an illness or injury. Home Health services are primarily reimbursed by Medicare, helping patients regain strength and function. This segment complements the other services by providing a higher level of clinical intervention when needed.
What management is betting on now
Addus HomeCare's leadership is focused on growing the company by expanding its reach both organically (growing existing services) and through strategic acquisitions. They aim to increase revenue by at least 10% annually, with a portion coming from new clients and services in areas where they already operate. A key strategy is to acquire other companies that can add to their service offerings or geographic presence, aiming to bring in about $100 million in revenue annually from these deals. Management is also working to improve the efficiency of their operations, particularly in their hospice services, and to ensure they can continue to attract and retain caregivers to meet the rising demand for home-based care.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$46.59M
FY2024 Q4
$8.72M
FY2025 Q1
$17.07M
FY2025 Q2
$21.28M
FY2025 Q3
$49.35M
FY2025 Q4
$16.10M
FY2026 Q1
$50.65M
FY2026 Q2
$38.67M
Revenue
$377.42M
Net income
$27.61M
Diluted EPS
1.49
Operating cash flow
$40.01M
Free cash flow
$38.67M
Fetching…
Sources
Revenue
$363.61M
Net income
$25.07M
Diluted EPS
1.36
Operating cash flow
$52.37M
Free cash flow
$50.65M
Fetching…
Sources
Revenue
$373.08M
Net income
$29.78M
Diluted EPS
1.62
Operating cash flow
$18.76M
Free cash flow
$16.10M
Fetching…
Sources
Revenue
$362.30M
Net income
$22.85M
Diluted EPS
1.24
Operating cash flow
$51.27M
Free cash flow
$49.35M
Fetching…
Sources
Revenue
$349.44M
Net income
$22.05M
Diluted EPS
1.20
Operating cash flow
$22.53M
Free cash flow
$21.28M
Fetching…
Sources
Revenue
$337.71M
Net income
$21.23M
Diluted EPS
1.16
Operating cash flow
$18.95M
Free cash flow
$17.07M
Fetching…
Sources
Revenue
$297.14M
Net income
$19.53M
Diluted EPS
1.06
Operating cash flow
$10.42M
Free cash flow
$8.72M
Fetching…
Sources
Revenue
$289.79M
Net income
$20.16M
Diluted EPS
1.10
Operating cash flow
$48.52M
Free cash flow
$46.59M
Fetching…
Sources
Is it cheap or expensive?
Fair value $199.93 vs current price $125.54
Wall Street consensus is the average analyst price target: $134.08 (-32.9% lower than our fair-value estimate).
Our most-likely fair value is $199.93 a share — about 59.3% above today's price of $125.54, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $9.3M. Interest coverage 10.2x.
Net debt
$9.25M
Interest coverage
10.18x
Addus HomeCare Corporation's profit covers its interest bill about 10.2 times over. which is stronger than most peers shown here.
Healthy
Worse cushion
Baseline
Better cushion
ADUS
BASELINE
Addus HomeCare Corporation
Total debt $108.82M Interest coverage 10.18x This is the baseline the peer rows are being compared against.
Total debt $392.19M Interest coverage 194.95x +1,814% vs ADUS Carries about 19.1x more debt cushion than ADUS.
Total debt $1.27B Interest coverage 6.19x -39% vs ADUS Carries about 1.6x less debt cushion than ADUS.
Total debt $2.80B Interest coverage 8.55x -16% vs ADUS Carries about 1.2x less debt cushion than ADUS.
What you should know
The case for and against ADUS
3 Rewards
0 Risks
Rewards
-
Revenue grew 3.8% last year.
-
Free cash flow was positive in 9/10 years.
-
Trades at 22.0x P/E vs peer median 24.1x (8.8% cheaper).
Risks
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)
21.99x
Forward P/E
16.70x
P/B
2.00x
P/S
1.59x
EV/EBITDA
14.36x
PEG ratio
1.09x
Profitability
How much profit each dollar creates
Gross margin
32.0%
Operating margin
9.7%
Net margin
7.1%
ROE
9.7%
ROA
6.3%
Health
Liquidity and balance-sheet strength
Debt / equity
0.09x
Current ratio
1.69x
Quick ratio
1.46x
Total debt
$108.82M
Total cash
$99.57M
Growth
How the business has been compounding
Revenue TTM
$1.48B
Revenue 5Y CAGR
13.3%
EPS TTM
5.71
EPS 5Y CAGR
22.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$162.41M
Free CF TTM
$103.79M
FCF margin
7.0%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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