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Aveanna Healthcare Holdings (AVAH)
NASDAQ:AVAH
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Aveanna Healthcare Holdings
(NASDAQ:AVAH)
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Rating:59Neutral
Price Target:
$7.50
▼(-7.41% Downside)
Aveanna Healthcare Holdings' overall score is driven by strong earnings call performance and positive technical indicators. However, financial instability due to high leverage and negative equity, along with a high P/E ratio, weigh down the score.
Positive Factors
Revenue Growth
The strong revenue growth reflects successful strategic initiatives and market expansion, indicating a robust demand for Aveanna's services.
Preferred Payer Strategy
The preferred payer strategy enhances revenue stability and allows for better wage management, supporting long-term operational efficiency.
Cash Flow and Liquidity
Strong cash flow and liquidity position provide financial flexibility, enabling Aveanna to invest in growth opportunities and manage debt obligations.
Negative Factors
High Leverage
High leverage poses financial risk, potentially limiting Aveanna's ability to invest in growth and increasing vulnerability to economic downturns.
Regulatory Environment
Regulatory changes could negatively impact reimbursement rates, affecting revenue and profitability in the long term.
Medicaid Funding Concerns
Potential reductions in Medicaid funding could strain financial resources, impacting Aveanna's ability to maintain service levels and profitability.
Aveanna Healthcare Holdings (AVAH) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.69B
Dividend YieldN/A
Average Volume (3M)1.49M
Price to Earnings (P/E)107.7
Beta (1Y)1.53
Revenue Growth11.53%
EPS GrowthN/A
CountryUS
Employees33,500
SectorHealthcare
Sector Strength45
IndustryMedical - Care Facilities
Share Statistics
EPS (TTM)0.18
Shares Outstanding208,896,380
10 Day Avg. Volume1,358,171
30 Day Avg. Volume1,486,236
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.45
Enterprise Value/Revenue1.12
Enterprise Value/Gross Profit3.38
Enterprise Value/Ebitda10.55
Forecast
1Y Price Target
$8.50Price Target Upside4.94% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Aveanna Healthcare Holdings Business Overview & Revenue Model
Company DescriptionAveanna Healthcare Holdings (AVAH) is a leading provider of pediatric and adult home healthcare services in the United States. The company specializes in delivering skilled nursing, therapy, and personal care services to patients with complex medical needs. Aveanna operates in various sectors, including home health care, hospice, and therapy services, catering to individuals with chronic illnesses, disabilities, and recovery needs. Their core offerings encompass a wide range of services designed to enhance the quality of life for patients while providing support to families.
How the Company Makes MoneyAveanna Healthcare generates revenue primarily through the provision of home healthcare services billed to various payers, including private insurance, Medicaid, and Medicare. The company's revenue model is based on service contracts and reimbursement rates determined by these payers, which cover skilled nursing, therapy, and personal care services. Key revenue streams include hourly billing for nursing and therapy services, episodic payments for specific care episodes, and capitated payments for certain patient populations. Additionally, Aveanna's partnerships with healthcare providers and managed care organizations enhance their service offerings and can lead to increased patient referrals, further driving revenue growth. The company's focus on expanding its footprint in underserved markets and enhancing its service capabilities are also significant factors contributing to its earnings.
Aveanna Healthcare Holdings Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Positive
The earnings call presented strong financial performance with significant revenue and EBITDA growth, driven by successful strategic initiatives such as the preferred payer strategy and effective cost management. The integration of Thrive Skilled Pediatrics and positive cash flow further indicate a solid operational footing. However, challenges in the regulatory environment and concerns over Medicaid funding pose potential risks. Overall, the highlights outweigh the lowlights, reflecting a positive sentiment.Q2-2025 Updates
Positive Updates
Significant Revenue and EBITDA Growth
Aveanna reported a revenue of approximately $590 million, representing a 16.8% increase over the prior year period. Adjusted EBITDA was $88.3 million, a 93.6% increase compared to the prior year, driven by an improved rate environment and cost savings initiatives.
Preferred Payer Strategy Success
Aveanna’s preferred payer agreements accounted for about 55% of total private duty services MCO volumes. The preferred payer strategy is gaining momentum, allowing for increased caregiver wages and recruitment efforts.
Positive Cash Flow and Liquidity Position
Aveanna reported positive free cash flow of $36.9 million and liquidity of approximately $354 million at the end of Q2, reflecting strong cash collections and operational efficiency.
Thrive Skilled Pediatrics Integration
The acquisition of Thrive Skilled Pediatrics is on target with integration efforts, expanding Aveanna’s PDS offerings in 5 current states and adding new states Kansas and New Mexico. The acquisition is expected to be accretive to 2025 results.
Negative Updates
Challenging Regulatory Environment
The proposed home health rule for 2026 includes significant cuts totaling 6.4%, which Aveanna and industry peers strongly oppose due to the potential negative impact on seniors and the home health industry.
Medicaid Funding Concerns
State Medicaid directors and governors are planning for less overall Medicaid funding due to legislative changes, potentially impacting future reimbursement rates and requiring Aveanna to navigate through tighter budgets.
Company Guidance
During Aveanna Healthcare Holdings' second quarter 2025 earnings call, the company provided an enhanced outlook for the year with projected revenue exceeding $2.3 billion and adjusted EBITDA surpassing $270 million. This guidance reflects a robust 16.8% revenue growth over the prior year, reaching approximately $590 million, and a significant 93.6% increase in adjusted EBITDA to $88.3 million. The company attributed these results to improved rates, cost savings initiatives, and an uptick in value-based payments that contributed approximately $9 million to revenue and EBITDA. Additionally, Aveanna reported a gross margin of $210.8 million, or 35.8%, while liquidity stood at approximately $354 million. The company also highlighted its strategic efforts, including increasing preferred payer agreements, which currently account for 55% of their private duty services volumes, and achieving 10 rate enhancements in their private duty services segment.Aveanna Healthcare Holdings Financial Statement Overview
Summary
Aveanna Healthcare Holdings shows moderate revenue growth and improved cash flow generation. However, high leverage, negative equity, and low profitability margins significantly impact financial stability.Income Statement
Aveanna Healthcare Holdings shows moderate revenue growth with a TTM growth rate of 4.04%. Gross profit margin is stable at 33.2%, indicating efficient cost management. However, the net profit margin is low at 0.85%, suggesting challenges in translating revenue into profit. EBIT and EBITDA margins have improved but remain modest, reflecting operational inefficiencies.45
Neutral
Balance Sheet
The company has a concerning debt-to-equity ratio of -124.35, indicating high leverage and negative equity. This poses a significant financial risk. Return on equity is negative, reflecting poor profitability relative to shareholder investment. The equity ratio is also negative, highlighting financial instability.30
Negative
Cash Flow
Free cash flow has grown significantly by 174.37% in the TTM, indicating improved cash generation. The operating cash flow to net income ratio is 0.21, suggesting moderate cash conversion efficiency. However, the high leverage and negative equity remain concerns for long-term cash flow sustainability.55
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.18B | 2.02B | 1.90B | 1.79B | 1.68B | 1.50B |
| Gross Profit | 723.16M | 635.54M | 595.43M | 553.23M | 542.40M | 454.51M |
| EBITDA | 232.03M | 187.38M | 44.35M | -517.28M | -9.26M | 22.13M |
| Net Income | 18.55M | -10.93M | -134.52M | -662.03M | -117.04M | -57.05M |
Balance Sheet | ||||||
| Total Assets | 1.77B | 1.66B | 1.61B | 1.71B | 2.33B | 1.84B |
| Cash, Cash Equivalents and Short-Term Investments | 100.74M | 84.29M | 43.94M | 19.22M | 30.49M | 137.34M |
| Total Debt | 1.49B | 1.50B | 1.50B | 1.50B | 1.30B | 1.23B |
| Total Liabilities | 1.78B | 1.79B | 1.74B | 1.72B | 1.70B | 1.58B |
| Stockholders Equity | -11.99M | -122.09M | -127.44M | -4.17M | 637.95M | 267.17M |
Cash Flow | ||||||
| Free Cash Flow | 78.52M | 26.32M | 16.56M | -60.41M | -27.30M | 101.38M |
| Operating Cash Flow | 85.74M | 32.64M | 22.67M | -48.40M | -11.35M | 116.62M |
| Investing Cash Flow | -22.07M | -6.32M | -8.79M | -25.29M | -681.83M | -193.54M |
| Financing Cash Flow | -10.59M | 14.03M | 10.85M | 62.42M | 586.33M | 210.94M |
Aveanna Healthcare Holdings Technical Analysis
Positive
8.10
Price Trends
6.27
Positive
5.69
Positive
5.24
Positive
Market Momentum
0.51
Positive
60.60
Neutral
34.04
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVAH, the sentiment is Positive. The current price of 8.1 is below the 20-day moving average (MA) of 8.10, above the 50-day MA of 6.27, and above the 200-day MA of 5.24, indicating a neutral trend. The MACD of 0.51 indicates Positive momentum. The RSI at 60.60 is Neutral, neither overbought nor oversold. The STOCH value of 34.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AVAH.
Aveanna Healthcare Holdings Risk Analysis
Aveanna Healthcare Holdings disclosed 56 risk factors in its most recent earnings report. Aveanna Healthcare Holdings 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
Aveanna Healthcare Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | 833.64M | 30.84 | 8.56% | ― | 30.58% | 24.86% | |
68 Neutral | 1.15B | 111.87 | 2.27% | ― | 5.17% | -65.33% | |
68 Neutral | 1.19B | 34.33 | 6.33% | 2.28% | 16.24% | 116.58% | |
59 Neutral | $1.69B | 107.71 | 42.49% | ― | 11.53% | ― | |
54 Neutral | 717.43M | -2.41 | -49.02% | ― | -14.33% | -398.68% | |
46 Neutral | 1.88B | -7.51 | -230.26% | ― | 3.99% | -14.74% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
Performance Comparison
AVAH
Aveanna Healthcare Holdings
8.10
2.66
48.90%
AMN
AMN Healthcare Services
18.72
-25.66
-57.82%
BKD
Brookdale Senior Living
7.91
1.12
16.49%
HCSG
Healthcare Services
15.83
4.88
44.57%
USPH
US Physical Therapy
78.48
-2.76
-3.40%
PNTG
Pennant Group
24.12
-11.82
-32.89%
Aveanna Healthcare Holdings Corporate Events
Business Operations and StrategyFinancial Disclosures
Aveanna Healthcare Highlights Strong Financial Performance
Positive
Aug 8, 2025
On August 8, 2025, Aveanna Healthcare Holdings Inc. released a financial presentation to investors, highlighting key operating statistics and financial metrics. The presentation reported over $2.3 billion in revenue, a gross margin of 34.3%, and an adjusted EBITDA exceeding $270 million. The company operates 366 locations with 29,000 caregivers, delivering 43.9 million homecare hours annually. This announcement underscores Aveanna’s robust operational scale and financial performance, reinforcing its position as a major player in the home healthcare sector.
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Aveanna Healthcare Reports Strong Q2 2025 Financial Growth
Positive
Aug 7, 2025
Aveanna Healthcare Holdings announced its second-quarter financial results for 2025, showing significant growth in revenue and adjusted EBITDA compared to the previous year. The company reported a 16.8% increase in revenue to $589.6 million and a 93.6% increase in adjusted EBITDA to $88.4 million. The acquisition of Thrive Skilled Pediatric Care has expanded Aveanna’s pediatric services, contributing to its strategic transformation and market expansion. The company has raised its full-year 2025 revenue guidance to over $2.3 billion and adjusted EBITDA to over $270 million, reflecting strong operational performance and growth momentum.
Private Placements and FinancingBusiness Operations and Strategy
Aveanna Healthcare Expands Receivables Financing Agreement
Positive
Jun 27, 2025
On June 25, 2025, Aveanna Healthcare Holdings Inc.’s subsidiaries, Aveanna Healthcare LLC and Aveanna SPV I, LLC, entered into a seventh amendment to their Receivables Financing Agreement with a bank. This amendment increased the facility limit to $275 million and extended the termination date by three years, impacting the company’s financial flexibility and operational strategy.
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.