Addus HomeCare’s first quarter results were well received by the market, with management highlighting robust growth in its Personal Care segment and successful integration of its largest-ever acquisition, Gentiva. CEO Dirk Allison credited strong caregiver hiring and a 5.5% rate increase in Illinois as key drivers, while President Brad Bickham noted operational improvements in scheduling and service fulfillment. The company also benefited from targeted use of American Rescue Plan Act funds to support recruitment and retention in New Mexico. Management did not express caution or uncertainty regarding the quarter’s results.
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Addus HomeCare (ADUS) Q1 CY2025 Highlights:
- Revenue: $337.7 million vs analyst estimates of $339.9 million (20.3% year-on-year growth, 0.6% miss)
- Adjusted EPS: $1.42 vs analyst estimates of $1.33 (6.5% beat)
- Adjusted EBITDA: $40.57 million vs analyst estimates of $39.97 million (12% margin, 1.5% beat)
- Operating Margin: 9%, in line with the same quarter last year
- Sales Volumes rose 33.8% year on year (-1.7% in the same quarter last year)
- Market Capitalization: $2.06 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Addus HomeCare’s Q1 Earnings Call
- Ben Hendrix (RBC Capital Markets) inquired about potential Medicare Cap limitations in hospice. President Brad Bickham responded that the impact was immaterial, crediting balanced referral mix and recent sales leadership changes.
- Joanna Gajuk (Bank of America) questioned the sustainability of Personal Care volume growth after weather-related headwinds. Bickham confirmed that growth rebounded in February and March, expecting hours growth to remain in the 2%–2.5% range.
- Tao Qiu (Macquarie) asked about margin cadence following the Gentiva acquisition. CFO Brian Poff explained that Q1 is typically the lowest margin quarter, with sequential improvement expected as payroll tax caps are reached and operational synergies take hold.
- Matthew Gillmor (KeyBanc) sought insight into Gentiva’s performance versus expectations. Bickham said bottom-line performance was stronger than projected, with top line slightly lighter due to the timing of Medicaid redetermination in Texas.
- Jared Haase (William Blair) asked about workforce retention trends across service lines and at Gentiva. Bickham noted industry-wide improvement since the pandemic, with ongoing challenges in clinical hiring but significant progress in Personal Care retention.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will be watching (1) further integration and financial contribution from the Gentiva acquisition, (2) legislative outcomes in Texas and other key states regarding Medicaid rate increases, and (3) operational benefits from the rollout of workforce management technology across more states. Progress on additional acquisitions and sustained margin expansion will also be key markers of execution.
Addus HomeCare currently trades at $115.64, up from $104.37 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).
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