Extendicare (EXE) AI Stock Analysis

• Market Cap: C$1.19B
• Dividend Yield: 3.38%
• Average Volume (3M): 175.56K
• Price to Earnings (P/E): 15.6
• Beta (1Y): 0.62
• Revenue Growth: 9.38%
• EPS Growth: 117.85%
• Country: CA
• Employees: 23,500
• Sector: Healthcare
• Sector Strength: 42
• Industry: Medical - Care Facilities
• EPS (TTM): 0.18
• Shares Outstanding: 83,467,000
• 10 Day Avg. Volume: 215,251
• 30 Day Avg. Volume: 175,560
• PEG Ratio: 7.90
• Price to Book (P/B): 9.93
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.48
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$14.83
• Price Target Upside: 3.63% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 75 Outperform
• Price Target: C$16.50 ▲( 15.30% Upside)

Extendicare's strong financial performance, highlighted by robust profitability and strategic growth initiatives, drives its solid stock score. The company's fair valuation and dividend yield add to its attractiveness, although high leverage and potential overbought conditions pose risks. Positive earnings sentiment further supports the score.

Positive Factors

Acquisition

The company has been putting its under-levered balance sheet to work with the recent announcement of the agreement to acquire Closing the Gap, which fits nicely into the existing home health platform and will drive accretion into 2026.

Demographics

Given aging demographics and a significant LTC waitlist in Ontario, Extendicare should benefit from demand tailwinds ahead.

Operational Performance

Strong improvements in operating metrics within the LTC and home health businesses have led to leading price performance amongst Canadian seniors.

Negative Factors

Analyst Rating

Analyst's neutral rating reflects higher total returns expected elsewhere and a current preference for private-pay retirement residences.

Market Preference

Despite the positive aspects, there is currently a preference for companies with exposure to private-pay retirement residences.

Extendicare Business Overview & Revenue Model

Company Description

Extendicare (EXE) is a Canadian company specializing in senior care and retirement living, providing a range of services to meet the diverse needs of the elderly population. The company's operations encompass long-term care centers, retirement communities, and home health care services. Extendicare is committed to delivering high-quality, person-centered care to seniors, offering a continuum of services that include skilled nursing, rehabilitation, and personal support services.

How the Company Makes Money

Extendicare generates revenue primarily through its long-term care centers, retirement living facilities, and home health care services. The company's long-term care centers receive funding from provincial governments based on the number of residents and the level of care provided, supplemented by resident co-payments. Retirement living facilities generate income through rental fees and ancillary services offered to residents. Additionally, Extendicare's home health care services, provided under the ParaMed brand, earn revenue through government contracts and private pay clients. The company's earnings are further supported by strategic partnerships and acquisitions that expand its service offerings and geographic reach.

Extendicare Financial Statement Overview

Summary

Extendicare shows strong profitability and operational efficiency, with steady revenue growth. However, a high debt-to-equity ratio and negative free cash flow growth are concerns, although cash generation capabilities remain solid.

Income Statement

Extendicare has shown a consistent improvement in profitability with gross profit margin at 56.4% and net profit margin at 5.2% in TTM. Revenue growth is steady at 0.5% compared to the previous year. EBIT and EBITDA margins are healthy at 8.5% and 10.5%, respectively, indicating efficient operational performance.

Balance Sheet

The balance sheet reflects moderate stability with a debt-to-equity ratio of 2.29, indicating a high reliance on debt. Return on equity stands at 61.6%, and the equity ratio is 17.5%, suggesting potential risks due to leverage but also strong returns on equity.

Cash Flow

Cash flow analysis shows robust operational cash flow to net income ratio of 1.59, and free cash flow to net income ratio of 0.97, pointing towards strong cash generation capabilities. However, free cash flow growth rate is negative, indicating a decline from previous levels.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.47B	1.47B	1.30B	1.22B	1.22B	1.16B
	Gross Profit
831.64M	168.00M	167.62M	76.83M	151.72M	197.69M
	EBIT
124.62M	111.21M	62.96M	20.99M	56.62M	93.30M
	EBITDA
154.94M	152.52M	98.63M	48.90M	67.46M	125.08M
	Net Income Common Stockholders
77.14M	75.21M	33.98M	-4.51M	9.01M	42.59M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
109.47M	121.85M	75.91M	167.28M	104.63M	179.96M
	Total Assets
713.59M	719.79M	672.73M	781.58M	900.32M	963.13M
	Total Debt
286.85M	292.49M	334.52M	383.97M	536.85M	564.60M
	Net Debt
177.38M	170.64M	259.33M	216.69M	432.22M	384.64M
	Total Liabilities
588.38M	595.44M	584.81M	680.88M	798.40M	834.94M
	Stockholders Equity
125.21M	124.35M	87.92M	100.70M	101.92M	128.19M
Cash Flow		Free Cash Flow
74.61M	101.69M	-106.13M	-2.92M	-6.10M	88.17M
	Operating Cash Flow
122.64M	143.64M	23.28M	98.71M	63.42M	121.27M
	Investing Cash Flow
-17.50M	-9.11M	-84.45M	155.64M	-63.73M	2.00M
	Financing Cash Flow
-88.65M	-87.87M	-30.93M	-191.86M	-74.84M	-38.16M

Extendicare Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.31
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EXE, the sentiment is Positive. The current price of 14.31 is above the 20-day moving average (MA) of 14.20, above the 50-day MA of 13.47, and above the 200-day MA of 10.71, indicating a bullish trend. The MACD of 0.32 indicates Positive momentum. The RSI at 56.82 is Neutral, neither overbought nor oversold. The STOCH value of 42.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:EXE.

Extendicare Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EXE	75 Outperform	C$1.19B	15.57	71.61%	3.38%	9.38%	117.85%
DR	73 Outperform	$298.98M	2.35	33.87%	2.31%	-29.54%	667.77%
SIA	72 Outperform	C$1.64B	42.01	6.93%	5.26%	8.76%	14.05%
WELL	66 Neutral	C$1.04B	30.45	-3.53%	―	17.19%	-191.01%
CRRX	65 Neutral	C$180.02M	―	-4.48%	―	-0.69%	8.08%
Sector *	53 Neutral	$5.14B	3.03	-43.89%	2.83%	16.75%	-0.06%

Extendicare Corporate Events

Extendicare Reports Strong Q1 2025 Results and Strategic Growth Initiatives

Extendicare reported a strong first quarter in 2025, with a 42.7% increase in adjusted EBITDA to $29.0 million, driven by growth across all business segments. The company announced a 5.0% dividend increase and significant expansion in its home health care segment. Extendicare completed the sale of three LTC projects, generating $56.3 million in cash proceeds, and is advancing its acquisition of Closing the Gap Healthcare Group, which will add substantial service hours to its operations. The company’s strategic focus on growth and redevelopment is evident in its ongoing projects and acquisitions, positioning it for continued expansion in the healthcare sector.

Extendicare to Acquire Closing the Gap Healthcare Group

Extendicare Inc. announced that its subsidiary, ParaMed Inc., will acquire Closing the Gap Healthcare Group, a provider of integrated home and community-based healthcare services in Ontario and Nova Scotia. The acquisition, valued at approximately $75.5 million, is expected to close in the third quarter of 2025 and will be funded from cash on hand and existing credit facilities. This strategic move is anticipated to enhance Extendicare’s home health care operations, adding significant service volumes and revenue, while also generating cost synergies through the integration of back-office functions.

Extendicare Declares April 2025 Dividend

Extendicare Inc. announced a cash dividend of C$0.042 per common share for April 2025, payable on May 15, 2025, to shareholders of record as of April 30, 2025. This decision reflects the company’s ongoing commitment to providing value to its shareholders and maintaining its position as a key player in the senior care industry in Canada. The dividend is designated as an eligible dividend under Canadian tax law, potentially offering tax advantages to shareholders.

Extendicare to Announce Q1 2025 Financial Results

Extendicare Inc. has announced the release of its first quarter 2025 financial results scheduled for May 6, 2025, followed by a conference call on May 7, 2025, to discuss the results. This announcement highlights the company’s commitment to transparency and engagement with stakeholders, potentially impacting its market positioning and investor relations.

Extendicare Declares March 2025 Dividend

Extendicare Inc. has declared a cash dividend of C$0.042 per common share for March 2025, payable on April 15, 2025, to shareholders of record as of March 31, 2025. This announcement reflects Extendicare’s ongoing commitment to providing returns to its shareholders while maintaining its focus on delivering quality care services across Canada. The dividend designation as an ‘eligible dividend’ under the Income Tax Act (Canada) may have favorable tax implications for shareholders.

Extendicare Reports Strong Q4 2024 Results and Announces Dividend Increase

Extendicare reported a significant increase in adjusted EBITDA for the fourth quarter of 2024, driven by improvements across all business segments. The company completed several strategic initiatives, including acquiring LTC homes from Revera Inc., opening new facilities, and redeeming convertible debentures, which strengthened its financial position. The company also announced a 5% increase in its monthly dividend, reflecting its improved performance and growth prospects.

Extendicare Announces Board of Directors Changes

Extendicare Inc., a company listed on the Toronto Stock Exchange, has announced changes to its board of directors. Donald Clow and Heather-Anne Irwin have been appointed to the board, replacing Al Mawani who is retiring after seven years of service. These appointments bring the board back to nine directors. Clow brings extensive experience in the real estate sector, having held executive roles at Crombie REIT and other organizations, while Irwin has a strong background in finance and capital markets, currently serving on the boards of Artis REIT and the Ontario Financing Authority.