Why Acadia Healthcare Stock Just Drew Fresh Attention

Acadia Healthcare Company (ACHC) moved back into focus after hedge fund manager David Einhorn disclosed a new stake, alongside trading volume that surged well above typical levels and recent leadership changes.

The recent 1 day share price return of 5.54% caps a sharp short term rebound, with 7 day and 30 day share price returns of 25.43% and 43.58% respectively. However, the 1 year total shareholder return of 59.16% decline and 3 year total shareholder return of 79.56% decline show how early this recovery is after previous weakness, helped recently by Einhorn’s stake disclosure and leadership changes.

If Acadia’s move has you rethinking opportunities in healthcare, this is a good moment to see what else is setting up on our 25 healthcare AI stocks and broaden your watchlist.

With shares still 59.16% below their 1 year total return level yet trading at a 13.72% discount to the US$19.07 average analyst target, you have to ask: is this a reset opportunity, or has the market already priced in a healthier future?

Most Popular Narrative: 12.1% Undervalued

Acadia Healthcare's most followed narrative pins fair value at about $19.07 per share, a touch above the recent $16.77 close, which puts the latest rebound in a different light.

Accelerated facility development opening beds ahead of schedule, joint ventures with large healthcare systems, and ongoing expansion in high-demand lines (comprehensive treatment centers, specialty care) are expected to support multiyear top-line growth and operational leverage, with potential positive effects on revenue and earnings as new facilities ramp up.

Read the complete narrative. Read the complete narrative.

The fair value perspective here is based on a specific framework that includes higher revenue, improved margins, and a different earnings profile by the late 2020s. Curious which specific growth and profitability targets would need to align for that view to hold?

Result: Fair Value of $19.07 (UNDERVALUED)

However, you still need to weigh ongoing Medicaid volume pressure and higher bad debt expense, either of which could challenge the assumptions behind that undervaluation case.

Build Your Own Acadia Healthcare Company Narrative

If you look at this and feel your view is different, or simply prefer to test your own assumptions directly on the numbers, you can build a custom thesis in just a few minutes, starting with Do it your way

A great starting point for your Acadia Healthcare Company research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.