Leerink Swann analyst Ana Gupte has launched coverage of Acadia Healthcare with an 'outperform' rating and a $90 price target that gives investors 25 percent of upside from where the shares (Ticker: ACHC) closed on Tuesday. She sees the Franklin-based company beating the Street's consensus EBITDA numbers both this year and next.
Analyst Brian Tanquilut at Jefferies & Co. sees many bright days ahead for Acadia Healthcare investors. Following the company's second-quarter earnings report, he has raised his price target for the stock to $100 from $88. That leaves a lot of upside: Acadia (Ticker: ACHC) closed last week's trading at $81.02 and is to $81.84 this afternoon.
Analyst Paula Torch at Avondale Partners has raised her price target for shares of Acadia Healthcare following the company's second-quarter profit report. The Franklin-based behavioral health care provider is ahead of plan this year in adding beds to its facilities, and new projects will add to the company's ability to grow its top line to $4 billion by 2018. Torch also says margins — especially at the company's United Kingdom and acquired CRC operations — still have upside. That has led her to lift her target for Acadia, which closed Friday (Ticker: ACHC) at $81.78, to $96 from $84. Year to date, they're up more than 30 percent.
Though still highly leveraged, ACHC has consistently demonstrated its ability to generate cash from its current portfolio, and we expect continued solid operating cash flow in 2015 and 2016 to help ACHC execute on deals.
Torch also has taken stock of Community Health Systems' Q2 results and outlook. She's sticking with her 'outperform' rating even though volume and pricing trends "continue to lag peers," mostly due to hospitals previously owned by Health Management Associates. But the factors holding down CHS' valuation — its higher leverage and integration risks, among others — "are starting to mitigate and show signs of improvement," Torch writes. She still sees CHS (Ticker: CYH) climbing to $77 from the $56 and change at which it ended last week.
Acadia Healthcare has expanded its United Kingdom portfolio with the acquisition of a 15-bed residential rehabilitation facility in Southampton, England. The Manor Clinic center focused on addiction treatments, a sector of the British health services market in which Acadia was not yet active.
"As in the U.S., the addictions treatment market in the United Kingdom is large, growing and highly fragmented," said Chairman and CEO Joey Jacobs. "We believe The Manor Clinic is a wonderful opportunity through which to launch our presence in addictions treatment in the U.K., a market that we are confident represents a significant long-term growth opportunity for the Company."
Franklin-based Acadia also has completed its purchase of Belmont Behavioral Health in the Philadelphia market. Shares of the company (Ticker: ACHC) are up about 1 percent Wednesday to about $79.15. So far this year, they're up almost 30 percent.
Investors bid up shares of many Middle Tennessee health care companies Thursday morning after the U.S. Supreme Court upheld subsidies for people using the federal health insurance marketplace. At about 9:30 a.m., almost a half hour after the justices issued their opinion, both HCA Holdings and Community Health Systems were up about 8 percent — both to all-time highs — while fellow hospital operator LifePoint Health was up 5 percent. Other publicly held locals such as behavioral health plays Acadia Healthcare and AAC Holdings were up slightly. You can track all their movements today here.
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