Bank of America Securities analyst Joanna Gajuk has maintained their bullish stance on ACHC stock, giving a Buy rating yesterday.
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Joanna Gajuk has given her Buy rating due to a combination of factors influencing Acadia Healthcare’s performance. Despite weaker Medicaid volumes, the company benefits from higher-than-expected state-directed program payments, which help offset these challenges. Although the market has not fully appreciated this benefit due to anticipated cuts in state-directed programs starting in 2028, Acadia remains optimistic about its growth prospects.
Additionally, Acadia Healthcare is adjusting its capital expenditure plans by pausing certain projects, which is expected to enhance free cash flow and support EBITDA. The company anticipates manageable impacts from policy changes and expects revenue from existing state-directed programs to remain strong until 2025. These strategic adjustments and the underlying demand for services contribute to the attractive long-term growth potential, justifying the Buy rating at a currently depressed stock multiple.
In another report released yesterday, TD Cowen also maintained a Buy rating on the stock with a $25.00 price target.
ACHC’s price has also changed dramatically for the past six months – from $42.720 to $18.000, which is a -57.87% drop .