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AdaptHealth
(NASDAQ:AHCO)
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Rating:46Neutral
Price Target:
$6.50
▲(18.61% Upside)
Action:Reiterated
Date:09/09/26
AHCO scores low primarily due to weakened profitability and sharply compressed margins alongside elevated leverage, despite strong revenue growth and resilient operating cash flow. Technicals also weigh on the score, with the stock trading below key moving averages and a negative MACD. The latest earnings call adds near-term uncertainty after a large EBITDA guidance reset driven by contract ramp issues and supplier pricing, partially offset by a clear remediation plan and continued organic growth.
Positive Factors
Organic Revenue Growth
Strong organic growth indicates continued demand for AdaptHealth’s home-based therapies and supplies. Sustained expansion can improve operating leverage, deepen provider and payer relationships, and support recurring patient revenue over the next several quarters.
Negative Factors
Severe Margin and Profitability Pressure
The sharp gross-margin contraction and return to a sizable net loss weaken the earnings base supporting the business. Persistent profitability pressure can restrict reinvestment, reduce resilience to reimbursement or cost changes, and make growth less valuable if margins do not recover.
Read all positive and negative factors
Positive Factors
Negative Factors
Organic Revenue Growth
Strong organic growth indicates continued demand for AdaptHealth’s home-based therapies and supplies. Sustained expansion can improve operating leverage, deepen provider and payer relationships, and support recurring patient revenue over the next several quarters.
Read all positive factors
AdaptHealth Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down income from various business segments, indicating which parts of the company are generating the most revenue and where growth opportunities or challenges may exist.
Breaks down income from various business segments, indicating which parts of the company are generating the most revenue and where growth opportunities or challenges may exist.
Data provided by:
The Fly
The FlyAdaptHealth (AHCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$797.61M
Dividend YieldN/A
Average Volume (3M)2.31M
Price to Earnings (P/E)―
Beta (1Y)-0.08
Revenue Growth-0.43%
EPS Growth-408.09%
CountryUS
Employees10,900
SectorHealthcare
Sector Strength45
IndustryMedical - Devices
Share Statistics
EPS (TTM)-1.68
Shares Outstanding136,344,200
10 Day Avg. Volume2,027,952
30 Day Avg. Volume2,311,165
Financial Highlights & Ratios
PEG Ratio0.10
Price to Book (P/B)0.89
Price to Sales (P/S)0.41
P/FCF Ratio6.14
Enterprise Value/Market Cap4.32
Enterprise Value/Revenue1.15
Enterprise Value/Gross Profit11.05
Enterprise Value/Ebitda11.86
Forecast
1Y Price Target
$9.40Price Target Upside71.53% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)-0.2
Revenue Forecast (FY)$2.88B
AdaptHealth Business Overview & Revenue Model
Company Description
AdaptHealth Corp., alongside its network of subsidiaries, delivers a comprehensive range of home medical equipment (HME), supplies, and associated services across the United States. The company specializes in sleep therapy, providing CPAP and bi-P...
How the Company Makes Money
AdaptHealth primarily makes money by providing home medical equipment and recurring medical supplies to patients and billing third-party payors for those products and related services. Key revenue streams include: (1) Sleep therapy: revenue from i...
AdaptHealth Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 03, 2026
Earnings Call Sentiment Neutral
The call presents a mixed picture: underlying top-line growth and strong segment performance (double-digit organic growth, expanding capitated revenue, digital adoption, strategic portfolio simplification and actions to reduce debt) are meaningful positives. However, material near-term headwinds — notably operational inefficiencies and elevated costs on a large West Coast capitated contract, an unexpected supplier price increase ($30M H2 impact), a significant reduction in full-year adjusted EBITDA guidance, a Q2 negative free cash flow driven by elevated CapEx, and a $144.2M goodwill impairment — temper the outlook. Management outlined concrete remediation steps (workflow fixes, technology/digital adoption, restructuring savings, debt paydown plans and expected elimination of stranded overhead) and expects sequential improvement toward run-rate profitability, but the magnitude of the near-term earnings and cash-flow impacts means the positives and negatives are largely in balance for the near term.Positive Updates
Strong Top-Line Growth
Second quarter continuing-operations net revenue of $740.3M, up ~12.7% year-over-year and +15.9% organic growth. At the midpoint, full-year 2026 continuing-operations revenue guidance of $2.85B–$2.89B (excludes ~$630M of Diabetes Health revenue moving to discontinued operations).
Negative Updates
West Coast Capitated Contract Operational and Profitability Challenges
Significant ramp issues on the large West Coast capitated contract: unexpected higher order volumes (sleep resupply and enteral), inherited inefficient workflows (excess urgent orders) and elevated logistics and labor costs. Company estimates a ~$40M expected second-half profitability impact relative to prior projections; Jason noted a $15M Q2 miss and $40M revised second-half impact (total guide-down related to the contract of $55M).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line Growth
Second quarter continuing-operations net revenue of $740.3M, up ~12.7% year-over-year and +15.9% organic growth. At the midpoint, full-year 2026 continuing-operations revenue guidance of $2.85B–$2.89B (excludes ~$630M of Diabetes Health revenue moving to discontinued operations).
Read all positive updates
Company Guidance
AdaptHealth reset 2026 guidance on a continuing‑operations basis: full‑year net revenue $2.85–2.89 billion (excludes ~ $630 million of Diabetes Health revenue moving to discontinued operations) and adjusted EBITDA $490–520 million (down from prior $680–730 million) after a $100 million divestiture impact (≈$40M of EBITDA moving to discontinued ops and ~$60M of stranded corporate overhead, ~half of which is expected to be removed within 12 months), a $55 million revision related to the West Coast capitated contract (including a $15M Q2 miss and $40M H2 impact), a $30 million second‑half supplier price increase, and a $15 million second‑half hit from portfolio wind‑downs; full‑year free cash flow is expected to be $80–120 million (includes Diabetes cash flows). Near‑term guidance is Q3 net revenue $720–740 million, adjusted EBITDA margin ~17.9%, and Q3 free cash flow ≈ $50 million. For context, Q2 continuing‑ops net revenue was $740.3 million (organic growth 15.9%), adjusted EBITDA $132.0 million (17.8% margin), free cash flow was negative $20.9 million, CapEx was $166.2 million (including ~ $25 million of one‑time equipment/vehicle purchases), consolidated leverage was 3.06x (company targeting 2.5x and drew a $325 million delayed‑draw term loan to redeem 6.125% 2028 notes); management expects sequential improvement and run‑rate profitability on the West Coast capitated contract next year.AdaptHealth Financial Statement Overview
Summary
Income Statement
42
Neutral
Balance Sheet
48
Neutral
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.01B | 3.24B | 3.26B | 3.20B | 2.97B | 2.45B |
| Gross Profit | 312.09M | 568.56M | 681.09M | 681.77M | 417.43M | 445.61M |
| EBITDA | 290.67M | 472.53M | 628.02M | -171.09M | 558.49M | 544.21M |
| Net Income | -228.23M | -70.79M | 90.42M | -678.89M | 69.32M | 156.18M |
Balance Sheet | ||||||
| Total Assets | 4.34B | 4.32B | 4.49B | 4.51B | 5.22B | 5.25B |
| Cash, Cash Equivalents and Short-Term Investments | 43.29M | 106.14M | 109.75M | 77.13M | 46.27M | 149.63M |
| Total Debt | 2.07B | 1.90B | 2.13B | 2.29B | 2.33B | 2.37B |
| Total Liabilities | 2.95B | 2.79B | 2.91B | 3.04B | 3.06B | 3.18B |
| Stockholders Equity | 1.38B | 1.52B | 1.57B | 1.46B | 2.15B | 2.06B |
Cash Flow | ||||||
| Free Cash Flow | 97.68M | 219.38M | 235.78M | 143.20M | -17.56M | 72.37M |
| Operating Cash Flow | 583.27M | 601.77M | 541.84M | 480.67M | 373.87M | 275.68M |
| Investing Cash Flow | -624.38M | -303.19M | -310.27M | -357.28M | -411.17M | -1.82B |
| Financing Cash Flow | 15.76M | -302.19M | -198.95M | -92.53M | -66.05M | 1.60B |
AdaptHealth Technical Analysis
Negative
5.48
Price Trends
5.86
Negative
7.66
Negative
9.26
Negative
Market Momentum
>-0.01
Positive
44.77
Neutral
31.63
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AHCO, the sentiment is Negative. The current price of 5.48 is below the 20-day moving average (MA) of 5.98, below the 50-day MA of 5.86, and below the 200-day MA of 9.26, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 44.77 is Neutral, neither overbought nor oversold. The STOCH value of 31.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AHCO.
AdaptHealth Risk Analysis
AdaptHealth disclosed 49 risk factors in its most recent earnings report. AdaptHealth 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
AdaptHealth Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $2.28B | 31.50 | 16.72% | ― | 7.32% | 7.24% | |
64 Neutral | $2.20B | -55.51 | -17.88% | 22.22% | 23.57% | -543.50% | |
62 Neutral | $1.41B | 25.48 | 5.51% | 0.42% | 3.86% | -48.06% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
48 Neutral | $1.34B | -20.70 | -45.97% | ― | 3.92% | 70.03% | |
46 Neutral | $797.61M | -3.48 | -15.16% | ― | -0.43% | -408.09% | |
44 Neutral | $932.83M | 71.45 | 1.24% | ― | 0.84% | ― |
* Healthcare Sector Average
AHCO
AdaptHealth
6.03
-3.14
-34.24%
CNMD
Conmed
45.76
-0.95
-2.03%
IART
Integra Lifesciences
12.24
-3.19
-20.67%
UFPT
Ufp Technologies
286.00
96.63
51.03%
TNDM
Tandem Diabetes Care
19.68
4.53
29.90%
AXGN
AxoGen
49.25
27.00
121.35%
AdaptHealth Corporate Events
Business Operations and StrategyExecutive/Board Changes
AdaptHealth appoints new chief financial officer Currie
Positive
Sep 8, 2026
AdaptHealth Corp. announced on September 8, 2026 that its board has appointed Harriss T. Currie as chief financial officer, effective September 9, 2026, succeeding Jason Clemens, who will step down from CFO duties on September 8 and depart the com...
Business Operations and StrategyM&A Transactions
AdaptHealth divests diabetes unit to refocus core business
Positive
Jul 20, 2026
On July 19, 2026, AdaptHealth Corp. entered into a definitive agreement to sell substantially all assets of its Diabetes Health business to Cardinal Health’s subsidiary RGH Enterprises for $235 million in cash, subject to customary post-clos...
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.