The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how senior health, home health & hospice stocks fared in Q2, starting with AdaptHealth (NASDAQ: AHCO).
The senior health, home care, and hospice care industries provide essential services to aging populations and patients with chronic or terminal conditions. These companies benefit from stable, recurring revenue driven by relationships with patients and families that can extend many months or even years. However, the labor-intensive nature of the business makes it vulnerable to rising labor costs and staffing shortages, while profitability is constrained by reimbursement rates from Medicare, Medicaid, and private insurers. Looking ahead, the industry is positioned for tailwinds from an aging population, increasing chronic disease prevalence, and a growing preference for personalized in-home care. Advancements in remote monitoring and telehealth are expected to enhance efficiency and care delivery. However, headwinds such as labor shortages, wage inflation, and regulatory uncertainty around reimbursement could pose challenges. Investments in digitization and technology-driven care will be critical for long-term success.
The 7 senior health, home health & hospice stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 2%.
Thankfully, share prices of the companies have been resilient as they are up 6.2% on average since the latest earnings results.
AdaptHealth (NASDAQ: AHCO)
With a network of approximately 680 locations serving patients across all 50 states, AdaptHealth (NASDAQ: AHCO) provides home medical equipment, supplies, and related services to patients with chronic conditions like sleep apnea, diabetes, and respiratory disorders.
AdaptHealth reported revenues of $800.4 million, flat year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with a significant miss of analysts’ EPS estimates and full-year EBITDA guidance missing analysts’ expectations.
“AdaptHealth’s momentum continues to build,” said Suzanne Foster, CEO of AdaptHealth.
AdaptHealth delivered the slowest revenue growth and weakest full-year guidance update of the whole group. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $9.14.
Read our full report on AdaptHealth here, it’s free.
Best Q2: BrightSpring Health Services (NASDAQ: BTSG)
Founded in 1974, BrightSpring Health Services (NASDAQ: BTSG) offers home health care, hospice, neuro-rehabilitation, and pharmacy services.
BrightSpring Health Services reported revenues of $3.15 billion, up 29.1% year on year, outperforming analysts’ expectations by 5.2%. The business had a very strong quarter with a beat of analysts’ EPS estimates and full-year EBITDA guidance topping analysts’ expectations.
BrightSpring Health Services scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 37.9% since reporting. It currently trades at $28.49.
Is now the time to buy BrightSpring Health Services? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Chemed (NYSE: CHE)
With a unique business model combining end-of-life care and household services, Chemed (NYSE: CHE) operates two distinct businesses: VITAS, which provides hospice care for terminally ill patients, and Roto-Rooter, which offers plumbing and water restoration services.
Chemed reported revenues of $618.8 million, up 3.8% year on year, in line with analysts’ expectations. It was a softer quarter as it posted a significant miss of analysts’ EPS estimates.
As expected, the stock is down 3.4% since the results and currently trades at $450.70.
Read our full analysis of Chemed’s results here.
Addus HomeCare (NASDAQ: ADUS)
Serving approximately 66,000 clients across 22 states with a focus on "dual eligible" Medicare and Medicaid beneficiaries, Addus HomeCare (NASDAQ: ADUS) provides in-home personal care, hospice, and home health services to elderly, chronically ill, and disabled individuals.
Addus HomeCare reported revenues of $349.4 million, up 21.8% year on year. This print beat analysts’ expectations by 0.8%. Aside from that, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but a slight miss of analysts’ sales volume estimates.
The stock is up 2.9% since reporting and currently trades at $110.27.
Read our full, actionable report on Addus HomeCare here, it’s free.
The Pennant Group (NASDAQ: PNTG)
Spun off from The Ensign Group in 2019 to focus on non-skilled nursing healthcare services, Pennant Group (NASDAQ: PNTG) operates home health, hospice, and senior living facilities across 13 western and midwestern states, serving patients of all ages including seniors.
The Pennant Group reported revenues of $219.5 million, up 30.1% year on year. This number topped analysts’ expectations by 4.2%. It was a strong quarter as it also logged an impressive beat of analysts’ full-year EPS guidance estimates and full-year revenue guidance beating analysts’ expectations.
The Pennant Group pulled off the fastest revenue growth and highest full-year guidance raise among its peers. The stock is up 10.5% since reporting and currently trades at $24.60.
Read our full, actionable report on The Pennant Group here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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