Acadia Health Care Company, Inc. The CCHA recently completed the acquisition of leading Missouri-based behavioral health care provider, CenterPointe Behavioral Health System. Assets purchased from CenterPointe include four inpatient hospitals (equipped with 260 acute care beds and 46 specialized drug addiction beds) and 10 outpatient care facilities.
Intended to be immediately accretive to Acadia Healthcare’s financial results, the transaction was funded using cash and borrowing capacity from the ACHA revolving credit facility.
The latest decision highlights Acadia Healthcare’s collaborative approach to increasing service offerings, providing improved patient care and expanding the accessibility of its services to more patients. This, in turn, should strengthen Acadia Healthcare’s presence in Missouri, which presents attractive prospects for acquisition transactions. The recent development reflects ACHA’s efforts to strengthen its presence in high growth markets. CenterPointe appears to be an appropriate choice to complement Acadia Healthcare’s efforts, as the former operates behavioral health networks and has an extensive presence throughout Missouri.
ACHC is committed to applying a prudent capital allocation framework to pursue a growth strategy. Acadia Healthcare has undertaken buyouts in many markets, which have added facilities, beds and hospitals to the company’s network. Following the acquisition of facilities and programs, ACHA is undertaking further investments to expand facilities and introduce service offerings to meet the high demand for behavioral health services. These buybacks allow CDHA to achieve economies of scale and additional costs.
In December 2021, Acadia Healthcare purchased the real estate of three non-operational facilities in Illinois to penetrate deeper into the greater Chicago area. In early 2021, ACHA acquired the 61-bed mental hospital named Adventist Health Vallejo to meet behavioral health needs in Solano County.
In addition to buyouts, the ACHA remains keen on entering into joint ventures (JVs) with established healthcare organizations. These efforts not only strengthened Acadia Healthcare’s capacity and treatment network, but also enabled the healthcare provider to reach underserved communities. As of September 30, 2021, ACHA’s portfolio includes 230 behavioral health facilities in 40 states and Puerto Rico.
The merger with Minnesota-based Fairview Health Services in December 2021 marked Acadia Healthcare’s 16th joint venture. That same month, ACHA formed a joint venture with SCL Health to build a 144-bed stand-alone behavioral health unit in the Denver area.
The pursuit of growth-related initiatives in the form of buyouts or JVs benefits not only Acadia Healthcare but also the entire United States, which has grappled with the continuing incidence of behavioral health issues for some time. time. The resurgence of coronavirus cases with the advent of each new variant only underscores the urgent need for accessible and improved behavioral health services.
In addition to Acadia Healthcare, healthcare providers like HCA Health, Inc. HCA, Universal Health Services, Inc. UHS and Humana inc. HUM provides high quality behavioral health services and can capitalize on a high demand for these services.
HCA Healthcare is one of the leading providers of psychiatric care in the United States. Behavioral health services remain one of the fastest growing lines of business within the company. HCA continues to work with affiliated hospitals for better management of behavioral health services.
Using clinical resources and geographic presence, Universal Health Services enters into mutually beneficial collaborations with other health systems. This has helped UHS provide improved and affordable behavioral health services, leading to better patient outcomes.
Humana follows an integrated approach to meeting people’s behavioral, physical and pharmaceutical needs. HUM takes a holistic approach to behavioral health care and provides web-based health coaching, leading to better results and lower costs for members and employers.
Acadia Healthcare stock is up 20.2% year-on-year compared to industryrally of 39.9%.
Image source: Zacks Investment Research
ACHC currently has a Zacks Rank # 4 (Sell).
While HCA Healthcare and Humana shares gained 54% and 12.6%, respectively, in one year, Universal Health Services shares lost 3% in the same period.
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