Cantor Fitzgerald maintains Neutral on Acadia Healthcare stock

Published 03/04/2025, 13:16
Cantor Fitzgerald maintains Neutral on Acadia Healthcare stock

On Thursday, Cantor Fitzgerald maintained its Neutral rating on Acadia Healthcare (NASDAQ:ACHC) with a consistent price target of $40.00, as the stock trades near $29.21, close to its 52-week low. According to InvestingPro data, analyst targets range from $35 to $72, with 12 analysts recently revising earnings estimates downward. The firm’s analysts highlighted Acadia Healthcare’s pricing strategy, noting a disciplined approach across all its facilities. This observation aligns with the company’s emphasis on cost control, as previously outlined by management.

The analysts expressed optimism upon seeing no decrease in the number of psychiatric facility openings and no reduction in bonuses quarter over quarter. This trend was seen as a confirmation of the company’s operational strength and management’s ability to maintain staffing levels without compromising on service offerings. The company maintains profitability with a diluted EPS of $2.78 and revenue growth of 7.69% over the last twelve months, though InvestingPro analysis indicates rapid cash burn as a potential concern.

Moreover, the analysts found no signs that facilities listed in a New York Times (NYSE:NYT) article were experiencing difficulties in recruiting staff or felt compelled to reduce the number of openings. They considered this to be a positive indicator, especially since management had previously indicated that staffing levels might be adjusted if patient volumes did not rebound.

Acadia Healthcare’s commitment to maintaining a robust staffing model, despite potential market challenges, was recognized as a testament to the company’s strategic planning and execution. The analysts are continuing to monitor the situation for any changes that could impact the company’s performance.

The $40.00 price target set by Cantor Fitzgerald reflects the firm’s assessment of Acadia Healthcare’s current valuation and future prospects within the context of its financial performance and market conditions. According to InvestingPro’s Fair Value analysis, the stock appears undervalued despite a significant 61.47% decline over the past year. Get access to 8 additional ProTips and a comprehensive Pro Research Report covering what really matters about Acadia Healthcare, along with 1,400+ other stocks, through an InvestingPro subscription. As of now, the analysts have not adjusted this target, suggesting a wait-and-see approach as they continue to evaluate the company’s progress.

In other recent news, Acadia Healthcare has upsized its private offering of senior notes to $550 million, with the notes maturing in 2033 and carrying an interest rate of 7.375% per annum. The proceeds from this offering are intended to repay outstanding borrowings under Acadia’s existing senior secured revolving line of credit. Meanwhile, Raymond (NSE:RYMD) James has maintained its Strong Buy rating for Acadia Healthcare, setting a price target of $40 per share, while suggesting a private equity buyout could be a possibility. In contrast, Mizuho (NYSE:MFG) Securities has lowered its price target for Acadia Healthcare to $37, maintaining a Neutral rating following the company’s revised long-term financial targets. These new targets anticipate average annual revenue growth of 7-9% and adjusted EBITDA growth of 8-10%.

KeyBanc Capital Markets also adjusted its outlook, reducing the price target from $70 to $65, but keeping an Overweight rating on the stock. The revision follows Acadia Healthcare’s fourth-quarter results and a 2025 outlook that fell short of expectations. KeyBanc noted potential operational improvements and benefits from the Tennessee Doctor Payment Program could positively impact the company. These recent developments reflect a mix of financial strategies and analyst perspectives on Acadia Healthcare’s future performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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