tiprankstipranks
Trending News
More News >
Extendicare (TSE:EXE)
TSX:EXE
Advertisement

Extendicare (EXE) AI Stock Analysis

Compare
204 Followers

Top Page

TSE:EXE

Extendicare

(TSX:EXE)

Rating:68Neutral
Price Target:
C$14.00
▲(12.36%Upside)
Extendicare's strong earnings growth and strategic initiatives are significant positives, supported by its attractive dividend yield. However, technical analysis indicates bearish momentum, and financial leverage presents risks. The stock is currently rated as a Hold.
Positive Factors
Acquisitions
The company has been putting its under-levered balance sheet to work with the recent announcement of the agreement to acquire Closing the Gap, a business that fits nicely into the existing home health platform and will drive accretion into 2026.
Market Demand
Given aging demographics and a significant LTC waitlist in Ontario, Extendicare should benefit from demand tailwinds ahead.
Negative Factors
Market Preferences
Despite the positive aspects, there is currently a preference for companies with exposure to private-pay retirement residences.

Extendicare (EXE) vs. iShares MSCI Canada ETF (EWC)

Extendicare Business Overview & Revenue Model

Company DescriptionExtendicare Inc., through its subsidiaries, provides care and services for seniors in Canada. The company offers long term care (LTC) services; retirement living services; and home health care services, such as nursing care, occupational, physical and speech therapy, and assistance with daily activities, as well as contract and consulting services to third parties. It operates a network of 119 LTC homes and retirement communities, as well as home health care operations under the Extendicare, Esprit Lifestyle Communities, ParaMed, Extendicare Assist, and SGP Purchasing Partner Network brands. Extendicare Inc. was founded in 1968 and is based in Markham, Canada.
How the Company Makes MoneyExtendicare generates revenue primarily through its long-term care services, which include providing accommodation, meals, and healthcare services to residents in its facilities. The company also earns income through its retirement living operations, offering independent and assisted living arrangements. Another significant revenue stream comes from its home healthcare services, where Extendicare provides in-home nursing care, personal support, and therapy services. Additionally, Extendicare has partnerships and contracts with government entities and healthcare organizations that contribute to its financial performance. These partnerships often involve funding arrangements or service agreements that help stabilize revenue streams and support business growth.

Extendicare Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q1-2025)
|
% Change Since: -13.83%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call presented a robust performance across all business segments, with significant growth in revenue, earnings, and strategic acquisitions. However, there are some uncertainties regarding regulatory approvals and funding timelines.
Q1-2025 Updates
Positive Updates
Strong Revenue and Earnings Growth
Adjusted EBITDA increased to $35.6 million, up 18.2% over the prior year. Excluding out-of-period items, it increased by 42.7% to $29 million, with NOI and margin growth in all business segments.
Growth in Home Healthcare
Q1 average daily volumes were up 8.9% from the same period last year. Excluding out-of-period items, Q1 NOI margin improved by 200 basis points, driven by rate increases and operational efficiencies.
Managed Services Expansion
Year-over-year growth in revenue and NOI, largely due to the opening of 3 homes in the Axium JV and organic growth in beds serviced by SGP, which increased by 7.2%.
Increase in Dividend
The Board declared a 5% increase to the monthly dividend on common shares to $0.042 per share.
Acquisition of Closing the Gap Healthcare
Acquiring Closing the Gap for total cash consideration of approximately $75.5 million, expected to add approximately $84.2 million in revenue to the home healthcare segment.
Long-term Care Redevelopment Progress
Opened a new 256-bed long-term care home and closed the sale of 3 long-term care projects, demonstrating effective capital recycling.
Negative Updates
Delays in Long-term Care Funding
Uncertainty regarding the timing of new long-term care funding announcements in Ontario due to the provincial budget schedule.
Regulatory Approval Delays for Revera Acquisition
Pending regulatory approvals for the acquisition of 9 homes from Revera, causing potential delays in closing the transaction.
Company Guidance
In the first quarter of 2025, Extendicare Inc. achieved significant financial growth across its business segments, as highlighted during their analyst conference call. Adjusted EBITDA rose by 18.2% to $35.6 million year-over-year, and further increased by 42.7% to $29 million when excluding out-of-period items. The home healthcare segment saw an 8.9% increase in Q1 average daily volumes compared to the previous year, with an NOI margin improvement of 200 basis points. Long-term care experienced a 150 basis point NOI margin increase, while managed services revenue and NOI grew, driven by organic growth in beds serviced, which rose 7.2% from Q1 2024. The Board declared a 5% increase in the monthly dividend to $0.042 per share. Extendicare also announced the acquisition of Closing the Gap Healthcare for $75.5 million, expected to add $84.2 million in revenue to the home healthcare segment, with anticipated annualized cost synergies of $1.1 million. The acquisition is projected to close in Q3 2025.

Extendicare Financial Statement Overview

Summary
Extendicare shows strong profitability and operational efficiency, with steady revenue growth. However, the high debt-to-equity ratio and negative free cash flow growth suggest caution. The company is well-positioned in terms of cash flow generation, but reliance on debt poses potential financial risks.
Income Statement
78
Positive
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
65
Positive
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
72
Positive
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.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.47B1.30B1.22B1.17B1.10B
Gross Profit168.00M167.62M76.83M115.61M201.16M
EBITDA152.52M98.63M48.90M67.46M125.08M
Net Income75.21M33.98M69.55M11.50M54.19M
Balance Sheet
Total Assets719.79M672.73M781.58M900.32M963.13M
Cash, Cash Equivalents and Short-Term Investments121.85M75.91M167.28M104.63M179.96M
Total Debt292.49M334.52M383.97M536.85M564.60M
Total Liabilities595.44M584.81M680.88M798.40M834.94M
Stockholders Equity124.35M87.92M100.70M101.92M128.19M
Cash Flow
Free Cash Flow101.69M-106.13M-2.76M-6.10M88.17M
Operating Cash Flow143.64M23.28M98.87M59.08M121.27M
Investing Cash Flow-9.11M-84.45M155.64M-59.39M2.00M
Financing Cash Flow-87.87M-30.93M-191.86M-74.84M-38.16M

Extendicare Technical Analysis

Technical Analysis Sentiment
Negative
Last Price12.46
Price Trends
50DMA
13.83
Negative
100DMA
13.52
Negative
200DMA
11.79
Positive
Market Momentum
MACD
-0.35
Positive
RSI
29.57
Positive
STOCH
5.04
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EXE, the sentiment is Negative. The current price of 12.46 is below the 20-day moving average (MA) of 13.24, below the 50-day MA of 13.83, and above the 200-day MA of 11.79, indicating a neutral trend. The MACD of -0.35 indicates Positive momentum. The RSI at 29.57 is Positive, neither overbought nor oversold. The STOCH value of 5.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:EXE.

Extendicare Peers Comparison

Overall Rating
UnderperformOutperform
Sector (46)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
68
Neutral
C$1.68B42.936.93%5.19%8.76%14.05%
68
Neutral
C$1.05B13.7071.61%4.04%9.38%117.85%
62
Neutral
C$1.19B30.45-3.53%17.19%-191.01%
61
Neutral
C$183.22M-4.48%-0.69%8.08%
46
Neutral
C$201.68M-3.23-23.14%1.87%20.75%-0.36%
$207.58M2.3233.87%2.35%
$189.99M
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:EXE
Extendicare
12.46
5.12
69.75%
TSE:CRRX
CareRx
2.92
0.58
24.79%
TSE:SIA
Sienna Senior Living
18.04
3.38
23.06%
MFCSF
Medical Facilities
10.91
1.13
11.55%
TSE:WELL
WELL Health Technologies Corp
4.68
-0.27
-5.45%
TSE:MEDI
Wellbeing Digital Sciences Inc
1.85
0.00
0.00%

Extendicare Corporate Events

Dividends
Extendicare Declares July 2025 Dividend of C$0.042 per Share
Positive
Jul 15, 2025

Extendicare Inc. has declared a cash dividend of C$0.042 per common share for July 2025, payable on August 15, 2025, to shareholders of record as of July 31, 2025. This announcement reflects the company’s ongoing commitment to returning value to its shareholders, reinforcing its stable financial position and dedication to maintaining investor confidence.

The most recent analyst rating on (TSE:EXE) stock is a Hold with a C$11.00 price target. To see the full list of analyst forecasts on Extendicare stock, see the TSE:EXE Stock Forecast page.

Financial Disclosures
Extendicare Schedules Q2 2025 Financial Results Release and Conference Call
Neutral
Jul 7, 2025

Extendicare Inc. announced the release of its second quarter 2025 financial results scheduled for August 6, 2025, followed by a conference call on August 7, 2025, led by its top executives. This announcement is part of Extendicare’s ongoing communication strategy with stakeholders, reflecting its commitment to transparency and engagement in the senior care industry.

The most recent analyst rating on (TSE:EXE) stock is a Hold with a C$11.00 price target. To see the full list of analyst forecasts on Extendicare stock, see the TSE:EXE Stock Forecast page.

Private Placements and FinancingM&A TransactionsBusiness Operations and Strategy
Extendicare Expands with Acquisition and Credit Facility Increase
Positive
Jul 2, 2025

Extendicare has completed the acquisition of Closing the Gap Healthcare Group through its subsidiary ParaMed Inc., enhancing its capabilities in rehabilitation services and integrated care models. This acquisition, valued at $75.5 million with potential earnouts, is expected to strengthen Extendicare’s home healthcare platform. Additionally, Extendicare has increased its Senior Secured Credit Facility to $375 million, positioning itself for further strategic acquisitions and growth, supported by a $100 million increase in its credit facilities.

The most recent analyst rating on (TSE:EXE) stock is a Hold with a C$11.00 price target. To see the full list of analyst forecasts on Extendicare stock, see the TSE:EXE Stock Forecast page.

DividendsBusiness Operations and Strategy
Extendicare Declares June 2025 Dividend, Reinforcing Commitment to Shareholders
Positive
Jun 16, 2025

Extendicare Inc. has announced a cash dividend of C$0.042 per common share for June 2025, payable on July 15, 2025, to shareholders recorded by June 30, 2025. This move reflects the company’s ongoing commitment to providing returns to its investors while maintaining its focus on delivering quality care services to Canada’s growing senior population. The announcement may positively impact shareholder value and reinforce Extendicare’s position in the senior care industry.

The most recent analyst rating on (TSE:EXE) stock is a Hold with a C$11.00 price target. To see the full list of analyst forecasts on Extendicare stock, see the TSE:EXE Stock Forecast page.

M&A TransactionsBusiness Operations and Strategy
Extendicare Expands Senior Care Services with Acquisition of Nine Long-Term Care Homes
Positive
Jun 3, 2025

Extendicare Inc. has completed the acquisition of nine ‘Class C’ long-term care homes from Revera Inc. in Ontario and Manitoba, along with a parcel of vacant land in Ontario, for approximately $60.3 million. This strategic acquisition, funded by cash on hand, expands Extendicare’s footprint in the senior care industry, enhancing its capacity to provide quality care to a growing senior population. The transaction underscores Extendicare’s commitment to meeting the increasing demand for senior care services and strengthens its market position in Canada.

The most recent analyst rating on (TSE:EXE) stock is a Hold with a C$11.00 price target. To see the full list of analyst forecasts on Extendicare stock, see the TSE:EXE Stock Forecast page.

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy
Extendicare Announces 2025 Shareholder Meeting Results
Positive
May 27, 2025

Extendicare Inc. announced the results of its 2025 Annual and Special Meeting of Shareholders, where key decisions included the election of nine directors, the appointment of KPMG LLP as auditors, approval of unallocated entitlements under the Long Term Incentive Plan, and acceptance of the company’s approach to executive compensation. These decisions reflect strong shareholder support and are expected to reinforce Extendicare’s strategic direction and operational stability, impacting its positioning in the senior care industry and providing assurance to stakeholders about the company’s governance and financial oversight.

The most recent analyst rating on (TSE:EXE) stock is a Hold with a C$11.00 price target. To see the full list of analyst forecasts on Extendicare stock, see the TSE:EXE Stock Forecast page.

M&A TransactionsDividendsBusiness Operations and StrategyFinancial Disclosures
Extendicare Reports Strong Q1 2025 Results and Strategic Growth Initiatives
Positive
May 6, 2025

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.

M&A TransactionsBusiness Operations and Strategy
Extendicare to Acquire Closing the Gap Healthcare Group
Positive
May 1, 2025

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.

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 16, 2025