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1. Company Snapshot

1.a. Company Description

Aveanna 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.

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1.b. Last Insights on AVAH

Aveanna Healthcare Holdings Inc.'s recent performance was driven by robust revenue growth, improved gross margin, and a turnaround in adjusted earnings per share. The company's fourth-quarter 2024 results showed a significant increase in revenue, with a 45.1% surge in share price over the past five trading sessions. Aveanna's management team has also announced its participation in the RBC 2025 Global Healthcare Conference, indicating ongoing engagement with the investment community. Additionally, the company has entered into an agreement to acquire Thrive Skilled Pediatric Care, expanding its services and enhancing profitability.

1.c. Company Highlights

2. Aveanna's Q3 2025 Earnings: Strong Growth and Improved Profitability

Aveanna's third-quarter 2025 revenue was approximately $622 million, a 22.2% increase over the prior year period, and adjusted EBITDA was $80.1 million, a 67.5% increase. The company's earnings per share (EPS) came out at $0.15, beating estimates of $0.08. The strong financial performance was driven by the company's focus on obtaining adequate rates from payers and government partners, as well as progress in caregiver hiring and retention trends. Aveanna's gross margin in its PDS segment was around 29%, in line with expectations. With a current P/E Ratio of 24.2 and an EV/EBITDA of 15.52, the market seems to be pricing in reasonable expectations for the company's future growth.

Publication Date: Nov -24

📋 Highlights
  • Revenue & EBITDA Growth: Q3 revenue surged to $622 million (+22.2 YoY), with adjusted EBITDA at $80.1 million (+67.5 YoY).
  • Preferred Payer Expansion: Added 5 agreements in Q3, totaling 30, with 56% of PDS MCO volumes now tied to these contracts.
  • Guidance Raise: 2025 adjusted EBITDA guidance increased by $100 million (50% over three quarters), now exceeding $300 million.
  • Thrive Integration Progress: Thrive contributed $100 million in Q3 revenue, with annualized earnings expected to reach $100 million by year-end.
  • VBC Contract Momentum: 9 active value-based care agreements (9/30 preferred payers) and a target of 10 VBC contracts by 2025.

Preferred Payer Agreements Drive Growth

Aveanna added 5 preferred payer agreements in Q3, reaching a total of 30 agreements, and 56% of its total PDS MCO volumes are now tied to these agreements. The company achieved 10 rate enhancements in its private duty services business, with 5 additional rate wins in the quarter. As Jeffrey Shaner mentioned, "payers want more of what Aveanna has to offer," indicating a favorable trend for the company's growth. The preferred payer agreements have been a key driver of Aveanna's revenue growth, with an organic growth rate in PDS of 6.5-7% in Q3.

Home Health and Hospice Segment Sees Significant Growth

The company's home health and hospice segment saw 15.3% growth, with a 53.3% gross margin, in line with expectations. Aveanna remains cautious about deploying capital in home health due to reimbursement uncertainty but is encouraged by the potential for growth in the sector. The company is waiting for a final rule on home health reimbursement, expected late next week or the following week, which will provide certainty and allow them to move forward with their plans.

Value-Based Care Contracting and M&A Opportunities

Aveanna has a goal to achieve 10 value-based care (VBC) contracts this year and sees more appetite from payers for value-based agreements. The company has 9 VBC agreements with its preferred payers, focusing on fill rates and hospital readmission rates. Aveanna has been actively engaged in M&A activities, exploring small to medium-sized opportunities in both Medicaid and Medicare, including home health and hospice. The company is disciplined in its approach, seeking opportunities with a clear path to mid-single digits post-synergies.

Outlook and Valuation

Aveanna has raised its guidance for 2025, expecting revenue to be greater than $2.375 billion and adjusted EBITDA to be greater than $300 million. Analysts estimate next year's revenue growth at 6.8%. With a P/S Ratio of 0.8 and a Free Cash Flow Yield of 4.3%, Aveanna's valuation appears reasonable. However, the company's high Net Debt / EBITDA ratio of 6.15 and negative ROE of -135.46% are concerns that investors should consider.

3. NewsRoom

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Aveanna to Participate at the BofA Securities Home Care Conference

Dec -04

Source: globenewswire.com

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Aveanna Healthcare Holdings Inc. (NASDAQ:AVAH) Receives Average Rating of “Hold” from Analysts

Nov -29

Source: defenseworld.net

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Aveanna Healthcare Holdings Inc. (AVAH) Q3 2025 Earnings Call Transcript

Nov -06

Source: seekingalpha.com

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Here's What Key Metrics Tell Us About Aveanna (AVAH) Q3 Earnings

Nov -06

Source: zacks.com

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Aveanna Healthcare Holdings Announces Third Quarter Financial Results and Revised 2025 Outlook

Nov -06

Source: globenewswire.com

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Can Aveanna Drive a Strong Third Quarter on Care-Delivery Momentum?

Nov -04

Source: zacks.com

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Aveanna Announces Launch of Secondary Offering of Common Stock

Oct -21

Source: globenewswire.com

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Aveanna Announces Third Quarter 2025 Earnings Release Date and Conference Call

Oct -16

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.59%)

6. Segments

Private Duty Services

Expected Growth: 3.5%

Aveanna Healthcare Holdings Inc.'s Private Duty Services segment growth of 3.5% is driven by increasing demand for home-based care, an aging population, and government initiatives to shift care from institutional to community-based settings. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth.

Home Health & Hospice

Expected Growth: 3.8%

Aveanna Healthcare Holdings Inc.'s Home Health & Hospice segment growth of 3.8% is driven by increasing demand for home-based care, an aging population, and the shift towards value-based care. Additionally, the company's expansion into new markets, strategic partnerships, and investments in technology and clinical capabilities also contribute to its growth.

Medical Solutions

Expected Growth: 4.2%

Aveanna Healthcare Holdings Inc.'s Medical Solutions segment growth of 4.2% is driven by increasing demand for home healthcare services, expansion of Medicaid and Medicare Advantage programs, and strategic acquisitions. Additionally, the company's focus on providing high-acuity care and investing in technology to improve patient outcomes and operational efficiency also contribute to its growth.

7. Detailed Products

Home Healthcare

Aveanna Healthcare provides personalized home healthcare services, including skilled nursing, physical therapy, occupational therapy, and speech therapy, to patients in the comfort of their own homes.

Hospice Care

Aveanna Healthcare offers hospice care services, providing medical, emotional, and spiritual support to terminally ill patients and their families.

Private Duty Nursing

Aveanna Healthcare provides private duty nursing services, including one-on-one nursing care, to patients who require ongoing medical attention in their homes.

Pediatric Skilled Nursing

Aveanna Healthcare offers pediatric skilled nursing services, including medical and therapeutic care, to children with complex medical needs.

Adult Skilled Nursing

Aveanna Healthcare provides adult skilled nursing services, including medical and therapeutic care, to adults with complex medical needs.

Rehabilitation Therapy

Aveanna Healthcare offers rehabilitation therapy services, including physical, occupational, and speech therapy, to patients in their homes or in clinics.

8. Aveanna Healthcare Holdings Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Aveanna Healthcare Holdings Inc. operates in a niche market with limited substitutes, but there are some alternatives available, such as home healthcare services and community-based care.

Bargaining Power Of Customers

Aveanna Healthcare Holdings Inc. has a diverse customer base, including government payors, commercial payors, and patients, which reduces the bargaining power of individual customers.

Bargaining Power Of Suppliers

Aveanna Healthcare Holdings Inc. relies on a network of healthcare professionals and suppliers, but has some flexibility to negotiate prices and terms due to its scale and market position.

Threat Of New Entrants

Entering the home healthcare market requires significant investment in infrastructure, personnel, and regulatory compliance, which creates a barrier to entry for new competitors.

Intensity Of Rivalry

The home healthcare market is highly competitive, with many established players and a high level of fragmentation, leading to intense rivalry among competitors.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 109.74%
Debt Cost 10.56%
Equity Weight -9.74%
Equity Cost 14.09%
WACC 10.22%
Leverage -1126.32%

11. Quality Control: Aveanna Healthcare Holdings Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Healthcare Services Group

A-Score: 4.8/10

Value: 4.0

Growth: 2.9

Quality: 5.8

Yield: 2.0

Momentum: 9.5

Volatility: 4.7

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Cross Country Healthcare

A-Score: 4.7/10

Value: 6.6

Growth: 6.2

Quality: 4.6

Yield: 0.0

Momentum: 7.5

Volatility: 3.3

1-Year Total Return ->

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U.S. Physical Therapy

A-Score: 4.7/10

Value: 3.2

Growth: 3.3

Quality: 4.9

Yield: 4.0

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
Aveanna Healthcare

A-Score: 4.4/10

Value: 4.9

Growth: 6.4

Quality: 4.7

Yield: 0.0

Momentum: 9.5

Volatility: 1.0

1-Year Total Return ->

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Stock-Card
Pennant

A-Score: 3.8/10

Value: 3.1

Growth: 8.2

Quality: 3.9

Yield: 0.0

Momentum: 2.0

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
AMN Healthcare Services

A-Score: 3.4/10

Value: 9.2

Growth: 4.7

Quality: 3.0

Yield: 0.0

Momentum: 0.0

Volatility: 3.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

9.31$

Current Price

9.31$

Potential

-0.00%

Expected Cash-Flows