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Investing.com - Truist Securities has maintained its Hold rating and $28.00 price target on The Pennant Group (NASDAQ:PNTG), following management meetings that highlighted the company’s market positioning and recent acquisition activity. The stock, currently trading at $24.24, appears undervalued according to InvestingPro analysis, with analyst targets ranging from $28 to $40.
The research firm noted "upbeat" management meetings that showcased Pennant Group’s complementary business segments and favorable positioning within a strong demand environment, further enhanced by recent significant merger and acquisition activity. The company’s robust 30.6% revenue growth and strong financial health score of 3.8/5 on InvestingPro support this positive outlook.
Truist Securities expects continued robust demand trends in the home health and hospice segment, driven by demographics, relative cost advantages, and patient preferences, while anticipating that supply-demand imbalances will support growth in the Senior Living segment.
The firm highlighted that Pennant Group maintains solid financial flexibility following its AMED acquisition and possesses a full pipeline of potential deals, though near-term focus is expected to center on integrating AMED assets.
Truist has updated its fiscal year 2025 and 2026 estimates to reflect recent acquisition activity and introduced new projections for fiscal year 2027, while noting that clarity around home health reimbursement and the final rule remains a key near-term focus for the company.
In other recent news, Pennant Group Inc. reported its second-quarter earnings for 2025, revealing a revenue of $219.5 million, which exceeded the forecast of $210.59 million. The earnings per share (EPS) aligned with expectations at $0.27. Furthermore, Pennant Group announced the acquisition of home health, hospice, and personal care operations from UnitedHealth Group for $146.5 million. This acquisition includes 54 locations primarily in Tennessee, with additional facilities in Georgia and Alabama. The transaction is part of an antitrust settlement involving UnitedHealth and Amedisys Inc. with the U.S. Justice Department. RBC Capital recently raised its price target for Pennant Group to $34 from $33, maintaining an Outperform rating. This adjustment follows Pennant Group’s second-quarter financial results, which RBC Capital noted were in line with expectations. These developments highlight significant movements in Pennant Group’s operational and financial landscape.
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