Acadia Healthcare, the Healthcare sector company, was revisited by a Wall Street analyst on August 5. Analyst Whit Mayo from Leerink Partners maintained a Buy rating on the stock and has a $38.00 price target.
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Whit Mayo has given his Buy rating due to a combination of factors that suggest potential for future growth despite current challenges. The recent quarterly results showed that Acadia Healthcare’s revenue exceeded expectations, driven largely by the Tennessee DPP program, which provided a significant financial boost. However, when excluding this benefit, the company’s EBITDA fell short of forecasts, indicating underlying operational challenges that need to be addressed.
Despite these setbacks, Mayo sees potential in Acadia’s strategic moves, such as the addition of new beds and facilities, which could drive future revenue growth. While the company has lowered its guidance for 2025, the anticipated increase in Medicaid DPP benefits presents a positive outlook. Mayo’s Buy rating reflects confidence in Acadia’s ability to navigate these challenges and capitalize on new opportunities to enhance its financial performance.
Mayo covers the Healthcare sector, focusing on stocks such as Ardent Health Partners, Inc., Tenet Healthcare, and Universal Health. According to TipRanks, Mayo has an average return of 0.4% and a 46.04% success rate on recommended stocks.
In another report released today, UBS also maintained a Buy rating on the stock with a $31.00 price target.