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Addus Homecare (ADUS)
NASDAQ:ADUS
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Addus Homecare
(NASDAQ:ADUS)
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Rating:81Outperform
Price Target:
$132.00
▲(15.27% Upside)
Addus Homecare's strong financial performance and positive earnings call are the most significant factors driving the score. The company's strategic acquisitions and revenue growth in key segments bolster its position. Technical analysis and valuation suggest stability, with no immediate concerns. Challenges in the Home Health segment and regulatory risks are noted but do not overshadow the overall positive outlook.
Positive Factors
Revenue Growth
The significant revenue growth indicates strong demand for Addus Homecare's services, driven by market trends favoring home-based care. This trend is expected to continue, supporting long-term growth.
Debt Reduction
Reducing debt enhances financial stability and flexibility, allowing Addus Homecare to invest in growth opportunities and manage economic uncertainties effectively.
Strategic Acquisitions
Strategic acquisitions like Helping Hands Home Care expand market presence and service offerings, strengthening competitive positioning and driving future growth.
Negative Factors
Home Health Segment Challenges
Declining revenue in the Home Health segment suggests operational challenges or competitive pressures, potentially impacting overall growth if not addressed.
CMS Proposed Payment Rule Concerns
Potential reductions in Medicare payments could pressure margins and service availability, posing a risk to profitability and operational sustainability.
Labor Challenges in Clinical Hiring
Persistent labor challenges may limit service capacity and growth, impacting the ability to meet rising demand and maintain service quality.
Addus Homecare (ADUS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.08B
Dividend YieldN/A
Average Volume (3M)147.62K
Price to Earnings (P/E)24.8
Beta (1Y)0.41
Revenue Growth14.29%
EPS Growth7.85%
CountryUS
Employees6,165
SectorHealthcare
Sector Strength45
IndustryMedical - Care Facilities
Share Statistics
EPS (TTM)1.49
Shares Outstanding18,407,240
10 Day Avg. Volume143,858
30 Day Avg. Volume147,617
Financial Highlights & Ratios
PEG Ratio2.70
Price to Book (P/B)2.20
Price to Sales (P/S)1.85
P/FCF Ratio19.31
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue1.76
Enterprise Value/Gross Profit5.40
Enterprise Value/Ebitda16.57
Forecast
1Y Price Target
$139.57Price Target Upside21.88% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Addus Homecare Business Overview & Revenue Model
Company DescriptionAddus HomeCare Corporation, together with its subsidiaries, provides personal care services to elderly, chronically ill, disabled persons, and individuals who are at risk of hospitalization or institutionalization in the United States. It operates through three segments: Personal Care, Hospice, and Home Health. The Personal Care segment provides non-medical assistance with activities of daily living. This segment offers services that include assistance with bathing, grooming, oral care, feeding and dressing, medication reminders, meal planning and preparation, housekeeping, and transportation services. The Hospice segment provides palliative nursing care, social work, spiritual counseling, homemaker, and bereavement counseling services for people who are terminally ill, as well as related services for their families. The Home Health segment offers skilled nursing and physical, occupational, and speech therapy for the individuals who requires assistance during an illness or after hospitalization. The company's payor clients include federal, state, and local governmental agencies; managed care organizations; commercial insurers; and private individuals. As of December 31, 2021, the company served consumers through 206 offices located in 22 states. Addus HomeCare Corporation was founded in 1979 and is based in Frisco, Texas.
How the Company Makes MoneyAddus Homecare generates revenue primarily through the provision of home care services, which are reimbursed by various payers, including Medicare, Medicaid, and private insurance companies. The company's revenue model is predominantly fee-for-service, where they bill for the hours of care provided to clients. Key revenue streams include personal care services, skilled nursing services, and therapy services. Additionally, partnerships with healthcare providers and payers enhance their service offerings and patient access, contributing to the overall growth and stability of their earnings. As the demand for home care services continues to rise due to an aging population and a shift towards home-based care, Addus Homecare's revenue potential is bolstered by these market trends.
Addus Homecare Earnings Call Summary
Earnings Call Date:Aug 04, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 03, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue and earnings growth, successful debt reduction, and strategic acquisitions, primarily driven by the Personal Care and Hospice segments. However, challenges were noted in the Home Health segment and concerns over the CMS proposed payment rule impacting future service availability were expressed. Overall, the company showed positive momentum with some areas needing attention.Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Total revenue for the second quarter of 2025 was $349.4 million, an increase of 21.8% compared to the second quarter of 2024.
Increased Earnings Per Share
Adjusted earnings per share increased by 10.4% to $1.49 from $1.35 in the second quarter of 2024.
Adjusted EBITDA Growth
Adjusted EBITDA was $43.9 million, up 24.5% compared to the second quarter of 2024.
Debt Reduction
The company reduced bank debt by $30 million, leaving a balance of $173 million at quarter end.
Acquisition of Helping Hands Home Care
Addus HomeCare closed on its acquisition of Helping Hands Home Care, expanding its market coverage in Pennsylvania.
Personal Care Segment Performance
Personal Care segment showed a same-store revenue growth of 7.4% compared to the second quarter of 2024.
Hospice Segment Growth
Hospice same-store revenue increased by 10% compared to the same quarter of 2024.
Reimbursement Rate Increases
Illinois and Texas finalized budgets with reimbursement rate increases for personal care services, expected to add significant annualized revenue.
Negative Updates
Home Health Segment Challenges
Home health same-store revenue decreased by 6% compared to the same quarter of 2024.
CMS Proposed Payment Rule Concerns
The proposed rule projects a 6.4% reduction in Medicare payments to home health agencies, which could impact service availability.
Labor Challenges in Clinical Hiring
Continued challenges in clinical hiring, particularly in certain geographic areas.
Disappointment with Hospice Rate Increase
The 2.6% increase for hospice providers does not fully reflect the rising cost of care.
Company Guidance
During the Addus HomeCare second quarter 2025 earnings call, the company reported a 21.8% increase in total revenue, reaching $349.4 million, compared to $286.9 million in the same quarter of 2024. This growth was accompanied by a rise in adjusted earnings per share to $1.49, a 10.4% increase from the previous year's $1.35. Adjusted EBITDA also saw a significant boost, climbing 24.5% to $43.9 million. The company highlighted strong cash flows, ending the quarter with approximately $91 million in cash on hand and reducing bank debt by $30 million to $173 million. Key operational metrics included 105 hires per business day in the Personal Care segment and a 7.4% same-store revenue growth in the Personal Care segment. Addus also discussed anticipated revenue increases due to reimbursement rate hikes in Illinois and Texas, projecting an additional $17.5 million and $17.7 million in annualized revenue, respectively. The company remains focused on strategic acquisitions, recently closing the acquisition of Helping Hands Home Care, enhancing its presence in Western Pennsylvania. Despite challenges in clinical hiring, Addus expressed confidence in its home-based care services and its potential for continued growth.Addus Homecare Financial Statement Overview
Summary
Addus Homecare demonstrates strong financial performance with consistent revenue growth, stable profitability margins, a solid balance sheet, and robust cash flow management. The company is well-positioned for future growth with manageable debt levels and efficient operations.Income Statement
Addus Homecare demonstrates strong revenue growth with a consistent increase over the past years. The Gross Profit Margin and Net Profit Margin are stable, reflecting efficient operations and profitability. EBIT and EBITDA margins also show a healthy margin, indicating effective cost management. Overall, the income statement reflects robust financial health.85
Very Positive
Balance Sheet
The company's balance sheet is solid with a moderate Debt-to-Equity Ratio, indicating a balanced approach to leveraging. Return on Equity is commendable, showing the company's ability to generate profits from shareholders' equity. The Equity Ratio is strong, suggesting a stable financial structure with low risk of over-leverage.78
Positive
Cash Flow
Operating cash flows are strong and consistently cover net income, demonstrating efficient cash management. Free Cash Flow has shown a positive trend, indicating the company's ability to generate cash after accounting for capital expenditures. This positions the company well for future investments or debt repayment.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.27B | 1.15B | 1.06B | 951.12M | 864.50M | 764.77M |
| Gross Profit | 415.24M | 375.02M | 339.88M | 299.74M | 269.85M | 226.24M |
| EBITDA | 135.36M | 120.61M | 106.56M | 83.14M | 80.70M | 57.18M |
| Net Income | 82.97M | 73.60M | 62.52M | 46.02M | 45.13M | 33.13M |
Balance Sheet | ||||||
| Total Assets | 1.41B | 1.41B | 1.02B | 937.99M | 947.59M | 892.58M |
| Cash, Cash Equivalents and Short-Term Investments | 91.18M | 98.91M | 64.79M | 79.96M | 168.90M | 145.08M |
| Total Debt | 222.25M | 273.13M | 175.18M | 178.05M | 263.55M | 239.67M |
| Total Liabilities | 387.08M | 442.14M | 317.73M | 304.45M | 373.24M | 373.91M |
| Stockholders Equity | 1.02B | 970.49M | 706.69M | 633.54M | 574.34M | 518.68M |
Cash Flow | ||||||
| Free Cash Flow | 96.79M | 110.38M | 102.79M | 96.81M | 34.84M | 102.58M |
| Operating Cash Flow | 100.42M | 116.43M | 112.25M | 105.11M | 39.49M | 109.41M |
| Investing Cash Flow | -356.09M | -354.61M | -119.24M | -106.59M | -42.02M | -214.24M |
| Financing Cash Flow | 173.54M | 272.30M | -8.18M | -87.45M | 26.34M | 138.19M |
Addus Homecare Technical Analysis
Positive
114.51
Price Trends
113.79
Positive
112.75
Positive
111.00
Positive
Market Momentum
0.11
Positive
52.02
Neutral
43.31
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ADUS, the sentiment is Positive. The current price of 114.51 is above the 20-day moving average (MA) of 114.12, above the 50-day MA of 113.79, and above the 200-day MA of 111.00, indicating a bullish trend. The MACD of 0.11 indicates Positive momentum. The RSI at 52.02 is Neutral, neither overbought nor oversold. The STOCH value of 43.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ADUS.
Addus Homecare Risk Analysis
Addus Homecare disclosed 31 risk factors in its most recent earnings report. Addus Homecare reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Addus Homecare Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $2.08B | 24.83 | 8.54% | ― | 14.29% | 7.85% | |
71 Outperform | $829.14M | 30.78 | 11.44% | ― | 30.58% | 24.86% | |
69 Neutral | $1.85B | 17.82 | 10.65% | 2.09% | 25.19% | 13.44% | |
66 Neutral | $1.45B | 56.80 | 3.50% | ― | 51.97% | -64.10% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
41 Neutral | $369.29M | ― | -60.64% | ― | 10.12% | -29.12% |
* Healthcare Sector Average
ADUS
Addus Homecare
114.51
-16.30
-12.46%
NHC
National Healthcare
121.50
3.19
2.70%
ASTH
Astrana Health
29.65
-31.42
-51.45%
PNTG
Pennant Group
24.07
-10.94
-31.25%
AGL
Agilon Health
0.91
-2.41
-72.59%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.