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Aveanna Healthcare Holdings (AVAH)
NASDAQ:AVAH
US Market

Aveanna Healthcare Holdings (AVAH) AI Stock Analysis

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Aveanna Healthcare Holdings

(NASDAQ:AVAH)

Rating:53Neutral
Price Target:
$5.00
▲(0.00%Upside)
Aveanna Healthcare's overall score reflects a blend of moderate financial performance and valuation concerns, offset by positive earnings call insights and corporate events. The company's financial instability and high leverage pose significant risks, despite recent revenue growth and strategic progress.
Positive Factors
Financial Performance
AVAH reported $45.6m of EBITDA on $505m of revenue, which beat consensus estimates by 22.8% and 2.3%, respectively.
Growth Outlook
Aveanna Healthcare is experiencing above-average volume growth in its core PDS segment, enhancing its long-term growth outlook.
Operational Momentum
Improved state reimbursement and Preferred Payer strategy are driving operational momentum for Aveanna Healthcare Holdings.
Negative Factors
Debt Management
Net leverage is ~1.5x lower than it was just one year ago.
Profitability Challenges
2Q24 marks the first quarter since 2Q22 that EBITDA exceeded interest expense.

Aveanna Healthcare Holdings (AVAH) vs. SPDR S&P 500 ETF (SPY)

Aveanna Healthcare Holdings Business Overview & Revenue Model

Company DescriptionAveanna Healthcare Holdings Inc., a diversified home care platform company, provides private duty nursing (PDN), adult home health and hospice, home-based pediatric therapy, and enteral nutrition services in the United States. Its patient- centered care delivery platform allows patients to remain in their homes and minimizes the overutilization of high-cost care settings, such as hospitals. The company operates through three segments: Private Duty Services (PDS), Home Health & Hospice (HHH), and Medical Solutions (MS). The PDS segment offers PDN services, which include in-home skilled nursing services to medically fragile children; nursing services in school settings in which its caregivers accompany patients to school; services to patients in its pediatric day healthcare centers; and employer of record support and personal care services, as well as in-clinic and home-based pediatric therapy services, such as physical, occupational, and speech services. The HHH segment provides home health services, including in-home skilled nursing services; physical, occupational, and speech therapy services; and medical social and aide services, as well as hospice services for patients and their families when a life-limiting illness no longer responds to cure-oriented treatments. The MS segment offers enteral nutrition supplies and other products to adults and children delivered on a periodic or as-needed basis. The company was incorporated in 2016 and is headquartered in Atlanta, Georgia.
How the Company Makes MoneyAveanna Healthcare Holdings generates revenue through a diversified model that includes several key streams. The primary source of income comes from providing home health services, which involve skilled nursing and therapy services delivered in a patient's home. Additionally, the company earns from its private duty services, which include non-medical personal care and support for daily living activities, as well as medically intensive care for patients with chronic conditions. Hospice care also contributes to their revenue, offering end-of-life care and support. Aveanna collaborates with various healthcare payers including Medicare, Medicaid, and private insurers, which reimburse the company for services rendered based on specific agreements and care plans. These partnerships and reimbursements are crucial to the company's financial performance.

Aveanna Healthcare Holdings Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: 3.73%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call reflected strong financial performance with significant revenue and EBITDA growth, successful execution of strategic initiatives, and a promising acquisition. However, challenges in the labor market and seasonal cash flow issues present areas of concern.
Q1-2025 Updates
Positive Updates
Significant Revenue Growth
Revenue for the first quarter was approximately $559 million, representing a 14% increase over the prior year period.
Substantial Increase in Adjusted EBITDA
First quarter adjusted EBITDA was $67.4 million, representing a 93.1% increase over the prior year period, primarily due to the improved pay rate environment and continued cost savings initiatives.
Preferred Payer Strategy Success
Preferred payer agreements increased to 24, accounting for approximately 54% of total PDS MCO volumes, up from 50% in Q4.
Private Duty Services (PDS) Growth
Revenue for the PDS segment was approximately $460 million, a 16.5% increase over the prior year, driven by a 6.1% increase in care volume.
ThriveSkilled Pediatrics Acquisition
The acquisition is expected to enhance Aveanna's preferred payer and government affairs strategies, with the transaction on target to close in the coming weeks.
Negative Updates
Challenging Labor Environment
While there are improvements, the labor environment remains a primary challenge, affecting growth trajectory.
Seasonal Cash Flow Challenges
Cash used by operating activities was $8.6 million, and free cash flow was negative $12.9 million, noting that Q1 typically represents a seasonal low point.
Company Guidance
During the first quarter of 2025, Aveanna Healthcare Holdings Inc. reported a revenue of approximately $559 million, marking a 14% increase over the same period last year. The adjusted EBITDA for the quarter was $67.4 million, reflecting a significant 93.1% rise from the previous year. This growth was largely attributed to an improved pay rate environment and ongoing cost-saving measures. The company's private duty services segment experienced a 16.5% revenue increase, while home health and hospice, as well as medical solutions, saw growths of 3.9% and 3.6%, respectively. Additionally, Aveanna's preferred payer strategy showed progress, with preferred pay agreements accounting for 54% of its total private duty services managed care organization volumes, up from 50% in the previous quarter. Looking ahead, Aveanna projects its 2025 revenue to exceed $2.15 billion and adjusted EBITDA to surpass $207 million.

Aveanna Healthcare Holdings Financial Statement Overview

Summary
Moderate revenue growth and improving cash flows are overshadowed by negative equity and high leverage, posing financial instability risks. Operational improvements need to address significant debt levels for better financial health.
Income Statement
45
Neutral
The income statement shows moderate revenue growth over recent years, with a notable increase from $1.89 billion in 2023 to $2.09 billion TTM (Trailing-Twelve-Months). Gross profit margins are stable, rising slightly from 31.4% in 2024 to 32% in TTM. However, the net profit margin is low at 0.73% TTM due to significant interest and operating expenses, though it has improved from negative in previous years. EBIT and EBITDA margins are relatively weak at 8.16% and 5.68% TTM, respectively, indicating room for operational efficiency improvements.
Balance Sheet
30
Negative
The balance sheet is concerning, showing negative stockholders' equity of -$98.7 million TTM, indicating financial instability. The debt-to-equity ratio is not calculable due to negative equity, but the high total debt of $1.32 billion suggests leverage risks. Return on Equity (ROE) is also unmeasurable due to negative equity, but the consistent negative equity ratio highlights the potential risk of insolvency.
Cash Flow
40
Negative
Cash flow analysis reveals improvements in free cash flow, which increased from $16.56 million in 2023 to $28.62 million TTM, reflecting a positive trend. The operating cash flow to net income ratio is robust at 2.35 TTM, indicating good cash conversion despite low net income. The free cash flow to net income ratio is high at 1.87, suggesting efficient cash generation relative to profit levels. However, fluctuations in operating cash flows in previous years indicate potential volatility.
BreakdownTTMDec 2024Dec 2023Dec 2022Mar 2022Dec 2020
Income Statement
Total Revenue2.09B2.02B1.90B1.79B1.68B1.50B
Gross Profit670.41M635.54M595.43M553.23M542.40M454.51M
EBITDA118.96M192.84M44.35M-517.28M-9.26M22.13M
Net Income15.35M-10.93M-134.52M-662.03M-117.04M-57.05M
Balance Sheet
Total Assets1.66B1.66B1.61B1.71B2.33B1.84B
Cash, Cash Equivalents and Short-Term Investments71.49M84.29M43.94M19.22M30.49M137.34M
Total Debt1.32B1.33B1.50B1.36B1.30B1.23B
Total Liabilities1.76B1.79B1.74B1.72B1.70B1.58B
Stockholders Equity-98.67M-122.09M-127.44M-4.17M637.95M267.17M
Cash Flow
Free Cash Flow28.62M26.32M16.56M-60.41M-27.30M101.38M
Operating Cash Flow35.98M32.64M22.67M-48.40M-11.35M116.62M
Investing Cash Flow-7.36M-6.32M-8.79M-25.29M-681.83M-193.54M
Financing Cash Flow269.00K14.03M10.85M62.42M586.33M210.94M

Aveanna Healthcare Holdings Technical Analysis

Technical Analysis Sentiment
Negative
Last Price5.00
Price Trends
50DMA
5.13
Negative
100DMA
4.95
Positive
200DMA
5.01
Negative
Market Momentum
MACD
-0.08
Negative
RSI
47.07
Neutral
STOCH
79.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVAH, the sentiment is Negative. The current price of 5 is below the 20-day moving average (MA) of 5.11, below the 50-day MA of 5.13, and below the 200-day MA of 5.01, indicating a bearish trend. The MACD of -0.08 indicates Negative momentum. The RSI at 47.07 is Neutral, neither overbought nor oversold. The STOCH value of 79.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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
78
Outperform
$1.13B27.758.37%3.71%1.32%
71
Outperform
$1.22B37.096.72%2.23%14.30%76.89%
68
Neutral
$931.35M35.2511.28%30.04%43.47%
BKBKD
56
Neutral
$1.61B-91.17%3.88%-34.30%
53
Neutral
$975.47M287.3642.49%9.05%
51
Neutral
$7.55B0.30-61.90%2.27%17.11%1.58%
AMAMN
49
Neutral
$841.88M18.62-21.08%-18.13%-215.78%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AVAH
Aveanna Healthcare Holdings
4.46
1.94
76.98%
AMN
AMN Healthcare Services
22.01
-26.45
-54.58%
BKD
Brookdale Senior Living
6.88
-0.41
-5.62%
HCSG
Healthcare Services
14.94
4.24
39.63%
USPH
US Physical Therapy
80.67
-9.57
-10.61%
PNTG
Pennant Group
25.90
2.15
9.05%

Aveanna Healthcare Holdings Corporate Events

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.

The most recent analyst rating on (AVAH) stock is a Hold with a $6.00 price target. To see the full list of analyst forecasts on Aveanna Healthcare Holdings stock, see the AVAH Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Aveanna Healthcare Holds 2025 Annual Stockholders Meeting
Neutral
May 9, 2025

On May 9, 2025, Aveanna Healthcare Holdings Inc. conducted its 2025 Annual Meeting of Stockholders. During the meeting, three Class I directors were elected to the Board for three-year terms, Ernst & Young LLP was ratified as the independent public accounting firm for the fiscal year ending January 3, 2026, and a non-binding advisory resolution on executive compensation was approved. No other matters were addressed at the meeting.

Business Operations and StrategyFinancial Disclosures
Aveanna Healthcare Highlights Financial Performance in Presentation
Positive
May 9, 2025

On May 9, 2025, Aveanna Healthcare Holdings Inc. released a financial presentation to investors, emphasizing the company’s use of its website as a primary channel for distributing important information. The presentation highlighted Aveanna’s financial performance and operational statistics, including over $2.15 billion in revenue and a significant presence across 34 states with 26,500 caregivers. The company continues to focus on growth strategies and maintaining a diverse payor mix, which is crucial for its financial stability and market positioning.

Business Operations and StrategyFinancial Disclosures
Aveanna Healthcare Reports Strong Q1 2025 Financial Performance
Positive
May 8, 2025

Aveanna Healthcare Holdings reported a strong financial performance for the first quarter of 2025, with a 14.0% increase in revenue to $559.2 million and a significant rise in adjusted EBITDA by 93.1% compared to the previous year. The company also revised its full-year 2025 revenue guidance to exceed $2.15 billion and adjusted EBITDA to surpass $207 million, reflecting positive momentum and strategic transformations, including successful cost reductions and improved reimbursement rates.

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.Date of analysis: Jul 02, 2025