Pennant Group (PNTG) AI Stock Analysis

• Market Cap: $931.35M
• Dividend Yield: N/A
• Average Volume (3M): 195.57K
• Price to Earnings (P/E): 35.3
• Beta (1Y): 0.72
• Revenue Growth: 30.04%
• EPS Growth: 43.47%
• Country: US
• Employees: 7,000
• Sector: Healthcare
• Sector Strength: 47
• Industry: Medical - Care Facilities
• EPS (TTM): 0.27
• Shares Outstanding: 34,468,983
• 10 Day Avg. Volume: 258,162
• 30 Day Avg. Volume: 195,568
• PEG Ratio: 0.24
• Price to Book (P/B): 2.64
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -62.26
• Enterprise Value/Market Cap: 0.69
• Enterprise Value/Revenue: 0.24
• Enterprise Value/Gross Profit: 6.48
• Enterprise Value/Ebitda: 3.82
• 1Y Price Target: $32.75
• Price Target Upside: 21.21% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 68 Neutral
• Price Target: $29.00 ▲(7.33%Upside)

The overall stock score reflects strong financial performance and growth prospects, boosted by a positive earnings call. However, high valuation and potential cash flow challenges pose risks, while technical indicators suggest caution.

Positive Factors

Acquisition Progress

Signature integration appears to be going well, and PNTG has seen strong retention of clinical staff.

Financial Performance

Strong Q1 across segments, with Home Health & Hospice outperformance more notable.

M&A Integration

Increasing estimates based on Q1 performance, high-end of guidance commentary and positive update on Signature integration process.

Negative Factors

Cash Flow Concerns

Operating cash flow did not meet expectations, highlighting potential challenges in financial management post-acquisition.

Operating Cash Flow

Q1 operating cash flow was below estimates, however company cited weakness was a function of acquisitions and timing rather than poor cash collection.

Pennant Group Business Overview & Revenue Model

Company Description

The Pennant Group, Inc. provides healthcare services in the United States. It operates in two segments, Home Health and Hospice Services, and Senior Living Services. The company offers home health services, including clinical services, such as nursing, speech, occupational and physical therapy, medical social work, and home health aide services; and hospice services comprising clinical care, education, and counseling services for the physical, spiritual, and psychosocial needs of terminally ill patients and their families. It also provides senior living services, such as residential accommodations, activities, meals, housekeeping, and assistance in the activities of daily living to seniors, who are independent or who require some support. As of December 31, 2021, the company operated 88 home health and hospice agencies, and 54 senior living communities with 4127 Senior Living units in Arizona, California, Colorado, Idaho, Iowa, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin, and Wyoming. The Pennant Group, Inc. was incorporated in 2019 and is headquartered in Eagle, Idaho.

How the Company Makes Money

The Pennant Group generates revenue primarily through its home health, hospice, and senior living services. In the home health and hospice segments, the company earns money by providing skilled nursing, physical therapy, occupational therapy, speech therapy, and medical social services to patients in their homes. These services are typically reimbursed by Medicare, Medicaid, and private insurance companies. In the senior living segment, Pennant Group operates residential communities that offer various levels of care, including independent living, assisted living, and memory care. Revenue in this segment is derived from resident fees, which can vary based on the level of care and services provided. Additionally, the company may engage in strategic partnerships and acquisitions to expand its service offerings and geographic presence, further contributing to its revenue growth.

Pennant Group Financial Statement Overview

Summary

Pennant Group shows strong revenue growth and improved profitability, suggesting a positive trajectory in its operations. The balance sheet reflects a moderate level of leverage, which warrants careful management to mitigate potential risks. Cash flow generation is stable but could benefit from improved consistency. Overall, the company presents a promising yet cautious financial outlook.

Income Statement

The company has shown consistent revenue growth with a TTM (Trailing-Twelve-Months) revenue of $748.17M, up from $695.24M in 2024. Gross profit margin remains stable at 13.27% in TTM, demonstrating operational efficiency. The net profit margin improved to 3.40% in TTM, indicating better profitability. Both EBIT and EBITDA margins have shown improvement, reflecting enhanced earnings before interest and taxes, and before interest, taxes, depreciation, and amortization.

Balance Sheet

The debt-to-equity ratio stands at 1.10, reflecting a moderate level of leverage. Return on equity improved to 8.38% in TTM, indicating better returns for shareholders. The equity ratio is 40.82%, suggesting a stable capital structure with a good proportion of equity funding. However, the high level of debt may pose potential risks.

Cash Flow

Operating cash flow to net income ratio is 0.69, indicating positive cash conversion from net income. Free cash flow to net income ratio is 0.34, showing some capacity for reinvestment and debt servicing. Free cash flow growth has been volatile, with the latest TTM showing a decrease compared to the previous period. Overall, cash flow management appears moderate with room for improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	748.17M	695.24M	544.89M	473.24M	439.69M	390.95M
Gross Profit	99.31M	93.76M	67.04M	58.59M	45.74M	54.89M
EBITDA	45.82M	44.44M	30.64M	24.60M	9.46M	23.82M
Net Income	25.43M	22.56M	13.38M	6.64M	2.15M	15.74M
Balance Sheet
Total Assets	743.62M	679.52M	539.69M	512.12M	530.30M	506.98M
Cash, Cash Equivalents and Short-Term Investments	5.22M	24.25M	6.06M	2.08M	5.19M	43.00K
Total Debt	333.29M	273.09M	329.63M	326.57M	355.24M	319.00M
Total Liabilities	420.60M	367.56M	394.18M	386.46M	416.05M	405.80M
Stockholders Equity	303.60M	293.28M	140.34M	121.01M	110.20M	96.58M
Cash Flow
Free Cash Flow	8.72M	30.31M	24.98M	-5.13M	-24.53M	42.95M
Operating Cash Flow	17.52M	39.30M	33.09M	9.04M	-18.22M	50.20M
Investing Cash Flow	-97.35M	-70.68M	-30.22M	-24.24M	-20.12M	-41.62M
Financing Cash Flow	82.32M	49.57M	1.11M	12.08M	43.49M	-8.95M

Pennant Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 27.02
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PNTG, the sentiment is Negative. The current price of 27.02 is below the 20-day moving average (MA) of 28.43, below the 50-day MA of 27.99, and below the 200-day MA of 28.65, indicating a bearish trend. The MACD of -0.05 indicates Positive momentum. The RSI at 35.07 is Neutral, neither overbought nor oversold. The STOCH value of 39.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PNTG.

Pennant Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HCSG	78 Outperform	$1.13B	27.75	8.37%	―	3.71%	1.32%
USPH	71 Outperform	$1.22B	37.09	6.72%	2.23%	14.30%	76.89%
PNTG	68 Neutral	$931.35M	35.25	11.28%	―	30.04%	43.47%
BKD	56 Neutral	$1.61B	―	-91.17%	―	3.88%	-34.30%
SNDA	55 Neutral	$455.60M	―	-70.23%	―	26.13%	37.38%
AVAH	53 Neutral	$975.47M	287.36	42.49%	―	9.05%	―
Sector *	51 Neutral	$7.55B	0.30	-61.90%	2.27%	17.11%	1.58%

Pennant Group Corporate Events

Pennant Group Holds Annual Stockholders Meeting

On May 16, 2025, The Pennant Group, Inc. held its Annual Meeting of Stockholders, with 28,085,566 shares present either in person or by proxy. During the meeting, significant decisions were made, including the election of Stephen M.R. Covey and Suzanne D. Snapper as Class III directors, approval of an amendment to the certificate of incorporation, and the ratification of Deloitte & Touche LLP as the independent registered public accounting firm for 2025. Additionally, the Amended and Restated 2019 Omnibus Incentive Plan was approved, and the compensation for the company’s executive officers received advisory approval.

The most recent analyst rating on (PNTG) stock is a Buy with a $30.00 price target. To see the full list of analyst forecasts on Pennant Group stock, see the PNTG Stock Forecast page.

Pennant Group Reports Strong Q1 2025 Financial Results

On May 6, 2025, The Pennant Group, Inc. announced its first quarter 2025 financial results, reporting a significant increase in earnings and revenue compared to the previous year. The company achieved a GAAP diluted earnings per share of $0.22 and an adjusted diluted earnings per share of $0.27. Total revenue for the quarter reached $209.8 million, marking a 33.7% increase, while net income rose by 58.5% to $7.8 million. The home health and hospice services segment saw a 37.2% revenue increase, and the senior living services segment experienced a 23.6% revenue growth. The company attributes its strong performance to ongoing investments in leadership development and strategic acquisitions, which have driven record operational results.