Acadia Healthcare Misses Q4 Revenue Estimates, Stock Drops 13.9%

Acadia Healthcare Company, Inc. (NASDAQ: ACHC), a leading provider of behavioral healthcare services in the United States, reported fourth-quarter 2024 results that missed revenue estimates, leading to a 13.9% drop in its stock price. The company's revenue totaled $774.2 million, falling short of the Zacks Consensus Estimate of $779.89 million. Net income attributable to Acadia was $32.6 million, or $0.35 per diluted share, also missing the expected $0.72 per share.

Several factors contributed to Acadia Healthcare's missed revenue estimates in Q4. The company's Specialty Treatment Facilities' revenues decreased by nearly 2% from the year-ago figure, while Comprehensive Treatment Centers' revenues fell by 1.2%. Additionally, expenses increased by more than 6% in the quarter, driven by higher salaries, wages, and benefits, professional fees, and other operating costs. Rising utilization also led to increased supply costs.

Acadia Healthcare's stock price has reacted negatively to the earnings miss, with shares dropping 54% over the past 12 months. However, the company's guidance for 2025 suggests a potential turnaround. Acadia Healthcare expects revenue in the range of $765 million to $775 million for the current quarter and full-year earnings in the range of $2.50 to $2.80 per share, with revenue ranging from $3.3 billion to $3.4 billion.

To achieve its revenue and earnings targets, Acadia Healthcare can implement several strategic initiatives and operational improvements. These include expanding bed capacity and reaching more patients, improving patient days and admissions, optimizing revenue per patient day, controlling expenses, and investing in technology and quality initiatives. By focusing on these areas, Acadia Healthcare can work towards meeting its 2025 financial guidance and reversing the recent decline in its stock price.

In an interview with Barron's, Acadia Healthcare CEO Chris Hunter commented on the company's performance and outlook: "Our fourth quarter financial and operating results capped off a year of solid growth and progress for Acadia. The continued momentum in our business allowed us to achieve record annual revenue of $3.2 billion. These results reflect the robust demand for our behavioral healthcare services and our ability to expand our capacity and meet this demand across the care continuum. In 2024, we had our largest bed expansion year in Acadia history, allowing us to reach more patients and communities. With our expanding scale and diverse service lines, supported by ongoing investments in technology and quality initiatives, we are well positioned for continued success. As the leading pure-play behavioral healthcare provider in the U.S., we are proud of the important work we are doing to address a critical societal need in our nation, and we remain focused on our purpose to 'Lead Care with Light®'. We look forward to the opportunities ahead for Acadia in 2025."

Acadia Healthcare's missed revenue estimates and subsequent stock price drop serve as a reminder of the challenges faced by the behavioral healthcare industry. However, with a strong focus on strategic initiatives and operational improvements, the company can work towards achieving its financial targets and regaining investor confidence.