BofA Securities DowngradesAcadia Healthcare (ACHC) to Underperform

BofA Securities analyst Joanna Gajuk downgraded Acadia Healthcare (NASDAQ: ACHC) from Neutral to Underperform with a price target of $13.00 (from $21.50).

The analyst comments "After the close on 12/2, ACHC cut its adj EBITDA guidance by $49m or 7% on the higher insurance costs and noted it expects a similar level of insurance costs in 2026. We are cutting our 2025/26/27E estimates to reflect the higher costs. We reduce our PO to $13 from $21.50 on the lower estimate and lower multiple (5.4x 2026E Adj EBITDA vs 6.2x prior) given the risk of additional litigation costs/ settlements and higher leverage. We downgrade ACHC to Underperform from Neutral given the risks to estimates from the higher legal costs which come on top of the payor pressure and weak volumes while free cash flow improvement will be harder given the lower EBITDA. We also have concerns about the upcoming cuts to Medicaid spending under the Reconciliation Act (a.k.a. OBBB)."

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