PNTG

Interested in The Pennant Group, Inc.? Here are five stocks we like better. Strong Q2 performance: Revenue rose 35.8% year over year to $298 million, while adjusted EBITDA increased 48.2% to $24.3 million and adjusted diluted EPS grew 33.3% to $0.36. Full-year outlook raised: Pennant now expects 2026 revenue of $1.17 billion to $1.19 billion, adjusted EBITDA of $94.4 million to $98 million, and adjusted diluted EPS of $1.34 to $1.41. Growth driven by home health, hospice and acquisitions: The segment’s revenue increased 43.2%, supported by Southeast expansion and improved same-store performance, while senior living revenue grew 12.6% as the company continued acquiring and integrating communities. 3 Small Cap Stocks That May Someday be Large Caps The Pennant Group (NASDAQ:PNTG) reported second-quarter 2026 results that showed revenue and adjusted earnings growth across its home health, hospice and senior living businesses, prompting the company to raise its full-year outlook. Chief Executive Officer Brent Guerisoli said the company’s performance reflected operational improvement in its established operations and progress integrating recently acquired businesses, including its sizable expansion in the Southeast. Pennant reported second-quarter revenue of $298 million, up 35.8% from a year earlier, while adjusted EBITDA rose 48.2% to $24.3 million. Adjusted EBITDA before noncontrolling interests increased 51% to $26.1 million, and adjusted diluted earnings per share increased 33.3% to $0.36. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth “Our momentum is the product of diligent focus on operational excellence, along with effective transitions at recently acquired operations,” Guerisoli said. Chief Financial Officer Lynette Walbom said year-to-date results put Pennant on pace to exceed the high end of its previous full-year outlook. The company now expects 2026 revenue of $1.17 billion to $1.19 billion, adjusted diluted earnings per share of $1.34 to $1.41, adjusted EBITDA of $94.4 million to $98 million, and adjusted EBITDA before noncontrolling interests of $101.5 million to $105.1 million. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High The updated forecast assumes continued operating strength, hospice reimbursement adjustments, higher interest expense, and contributions from joint ventures and management agreements, Walbom said. It excludes unannounced acquisitions, startups, share-based compensation, acquisition-related costs, and certain one-time or unusual items. As of June 30, Pennant had $201.9 million outstanding under its credit facility, $15.3 million in cash and net debt to adjusted EBITDA of 1.96 times. Year-to-date operating cash flow was $18.4 million. → Ulta's Growth Is Real, But So Are the Risks Pennant’s home health and hospice segment generated $237.8 million in second-quarter revenue, an increase of 43.2% from the prior-year period. Segment adjusted EBITDA increased 48.2% to $37.7 million, while adjusted EBITDA before noncontrolling interests rose 50% to $39.6 million. Same-store margin improved 70 basis points year over year, according to President and Chief Operating Officer John Gochnour. Hospice revenue reached $103.6 million, up 40.4%. Admissions rose 38.4% and average daily census increased 40.1%, with acquisitions contributing to those gains. On a same-store basis, hospice admissions increased 8.8% and average daily census rose 10.8%. Gochnour said CMS’s final 2027 hospice payment rule provides for a 2.3% increase in revenue per day, alongside program-integrity measures intended to address fraud and abuse in the industry. He said Pennant supports efforts to identify bad actors, while working with regulators on measures that are appropriately tailored. Home health revenue increased 50.8% to $119.4 million. Total home health admissions rose 62.3%, while Medicare admissions increased 70.7%. Revenue per episode declined 1.9%, which Gochnour attributed to the company’s Southeast expansion into markets with lower CMS wage indexes, along with lower related wage and service costs. Same-store total home health admissions rose 9.7%, and same-store Medicare admissions increased 13.6%. Pennant’s average CMS star rating was 4.1, compared with a national average of 3.0, while its potentially preventable hospitalization rate was 10%, compared with 10.8% nationally. Guerisoli said Pennant is modeling the proposed 2027 home health payment rule as a 1.7% increase for its operations, versus the rule’s stated 2.4% increase. He characterized the proposal as a positive signal after four consecutive years of annual base-rate reductions. Pennant continued integrating the home health and hospice operations acquired in the Southeast. Gochnour said the company had completed three transition waves and was nearing the end of a fourth, while a fifth and one of the largest waves began Aug. 1. The transition work is expected to continue through October. The company is implementing new branding, leadership structures, its Homecare Homebase electronic medical record instance, technology tools and clinical practices. Gochnour said the acquired operations’ financial margins were trending ahead of internal expectations, while patient volumes had remained stronger than expected during the transition process. In June, Pennant also expanded its relationship with Hartford HealthCare at Home, an organization it began managing in 2024. Hartford HealthCare at Home provides home health and hospice services to more than 30,000 patients annually from nine Connecticut locations. Pennant made an investment allowing it to share in the managed business’s profits or losses, which will be reflected as income from equity-method investments rather than consolidated revenue. Guerisoli said the arrangement provides Pennant with a sizable Northeast platform and supports its broader strategy of developing healthcare-system relationships and expanding its geographic presence. Pennant’s senior living segment generated $60.2 million in revenue, up 12.6% from the prior-year quarter. Segment adjusted EBITDA increased 13.2% to $5.8 million. Average monthly revenue per occupied unit increased 3.9% to $5,392 across all stores, while same-store monthly revenue per occupied unit rose 5.5% to $5,413. Same-store occupancy increased 150 basis points from a year earlier to 81.6%. Senior Living President Andy Ryder said same-store margins improved to 10.5% from 10% a year ago, although the company expects margin “lumpiness” in the third and fourth quarters as it integrates recently acquired, lower-occupancy communities. The company closed seven senior living transactions year to date. Its acquisitions included communities in Arizona, Wisconsin and California, as well as the August purchase of River Centre Assisted Living in Tucson, Arizona. The addition of River Centre and Copper Canyon Memory Care brought Pennant’s real estate portfolio to nine properties, including five acquired in the past 12 months. Management also discussed investments in automation and artificial intelligence. Guerisoli said the company is piloting technology intended to reduce clinician documentation burdens and automate back-office processes, with the goal of improving care delivery, employee experience and indirect costs over time. The Pennant Group (NASDAQ: PNTG) is a publicly traded holding company that provides specialized services to the asset management industry. Through its operating subsidiaries, the company delivers outsourced fund administration, securities lending, prime brokerage, and capital markets solutions designed to support hedge funds, private equity firms, mutual funds and other institutional investors. By leveraging a combination of technology platforms and industry expertise, The Pennant Group helps clients streamline middle- and back-office processes, enhance operational efficiency and manage regulatory requirements. Key service offerings include fund accounting and reporting, trade settlement and reconciliation, risk monitoring, securities lending programs and execution support across a range of asset classes. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "The Pennant Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

The Pennant Group, Inc. (PNTG) came out with quarterly earnings of $0.36 per share, beating the Zacks Consensus Estimate of $0.33 per share. This compares to earnings of $0.27 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +9.09%. A quarter ago, it was expected that this company would post earnings of $0.31 per share when it actually produced earnings of $0.32, delivering a surprise of +3.23%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. The Pennant Group, which belongs to the Zacks Medical - Outpatient and Home Healthcare industry, posted revenues of $297.98 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 3.47%. This compares to year-ago revenues of $219.5 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. The Pennant Group shares have added about 37.2% since the beginning of the year versus the S&P 500's gain of 13%. While The Pennant Group has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for The Pennant Group was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.34 on $294 million in revenues for the coming quarter and $1.35 on $1.17 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Outpatient and Home Healthcare is currently in the top 41% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Aveanna Healthcare (AVAH), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 13. This home health care services provider is expected to post quarterly earnings of $0.17 per share in its upcoming report, which represents a year-over-year change of -5.6%. The consensus EPS estimate for the quarter has been revised 6.7% higher over the last 30 days to the current level. Aveanna Healthcare's revenues are expected to be $647.08 million, up 9.8% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Pennant Group, Inc. (PNTG) : Free Stock Analysis Report Aveanna Healthcare Holdings Inc. (AVAH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Pennant Group Inc (NASDAQ:PNTG) reported strong Q2 2026 results with revenue up 35.8% and adjusted EBITDA up 48.2% year-over-year, putting the company on pace to exceed the top end of its original guidance. The company raised its full-year 2026 guidance for revenue, adjusted EBITDA, and adjusted EPS, reflecting strong momentum and successful integration of recent acquisitions. Same-store home health and hospice operations showed robust organic growth, with Medicare admissions up 13.6% and hospice ADC up 10.8% year-over-year, demonstrating strong market share gains. The 2027 proposed home health rule includes a 2.4% base rate increase, a positive shift after four consecutive years of cuts, which the company is modeling as a 1.7% increase for its operations. The company is expanding strategically through partnerships and acquisitions, including an equity investment in Hartford HealthCare at Home, which provides a platform for growth in the Northeast and strengthens its national presence. Clinical quality remains a key strength, with an average CMS star rating of 4.1 versus the national average of 3.0 and a potentially preventable hospitalization rate of 10%, which is better than the national average of 10.8%. The integration of the large Southeast acquisition is still in progress, with the largest transition waves continuing through October, which will naturally cause ongoing disruption and variability in results. The hospice industry is under intense scrutiny due to fraud and abuse issues, leading to new administrative costs and stricter program integrity measures that could impact operations. Revenue per episode in home health decreased by 1.9% year-over-year due to the mix of new Southeast operations, which have lower CMS wage indexes and lower revenue per episode. The company anticipates lumpiness in senior living margins in Q3 and Q4 as it integrates newly acquired communities, many of which have low occupancy and require significant investment. Elevated capital expenditures are expected, particularly for distressed senior living buildings acquired in late 2025, which will require spending to bring them up to company standards. Debt levels increased during the quarter, primarily due to the investment in Hartford HealthCare at Home, and the company faces elevated interest expense as it manages this debt. Warning! GuruFocus has detected 2 Warning Sign with COP. Is PNTG fairly valued? Test your thesis with our free DCF calculator. Q: Can you share the progress of integrating the Metasys assets in the Southeast, and what strength are you seeing in that new market? A: John Gochner, President and COO, stated that the integration is on schedule, with three transition waves completed and the fourth nearing its end. The fifth and one of the largest waves began on August 1. The inherited local leaders have embraced Pennant's operating model, and the implementation of new brands, technology, and clinical best practices is proceeding as planned. Financially, the assets are performing ahead of internal expectations, with volume remaining strong through the transition, indicating a high demand for quality providers in the region. Q: How are you thinking about the sustainability of your strong same-store performance and market share gains in home health and hospice? A: John Gochner, President and COO, attributed the strong performance to Pennant's locally driven model, which allows for diversified offerings and responsive referral source engagement. He noted that the company's ability to recruit and retain clinicians is a key competitive advantage, with declining turnover and improved headcount growth. While the company traditionally guides to mid-to-high single-digit organic growth, it has been performing above that for several quarters, driven by increasing demand and market share gains. Same-store margins also improved by 70 basis points year-over-year, reflecting the supportive culture among local owners. Q: What led to the decision to take an equity stake in the Hartford HealthCare at Home partnership, and is this a beachhead for Northeast expansion? A: John Gochner, President and COO, explained that after two years of successfully managing the business and improving patient access and financial stability, both parties decided to deepen the partnership by investing as co-owners. Brent Garisoli, CEO, added that the deal provides a sizable platform in the Northeast, allowing Pennant to make strategic investments, recruit leaders, and expand beyond Connecticut. This move is part of Pennant's evolution into a national company, enhancing payer negotiations and opening doors to new markets, with four meaningful healthcare system relationships now established across the country. Q: How are you managing the Medicare hospice cap, given the strong organic census growth, and are there any emerging concerns in new or same-store markets? A: John Gochner, President and COO, stated that cap management is a constant focus, particularly in California where patient eligibility often exceeds cap limits. The company recorded about $1.3 million in cap liability in the quarter, which is roughly $0.5 million lower than the prior year. Pennant uses sophisticated multi-year projection tools and provides monthly data to operators to manage census mix and length of stay. While most cap liability continues to come from California, the company feels comfortable with its management approach, balancing the obligation to serve eligible patients with financial prudence. Q: Can you provide more color on the same-store margins in the senior living business and the composition of the improved full-year guidance? A: Andy Rider, Senior Living President, noted that same-store margins in senior living are stable and improving, with the margin pressure coming primarily from new store additions. Same-store margins improved from 10% to 10.5% year-over-year. Brent Garisoli, CEO, explained that the raised guidance reflects better-than-expected performance in both the Southeast acquisition transition and core operations. The company was intentionally conservative at the start of the year given the largest transition in its history, but the strong execution by local leaders has allowed for an upward revision, with cautious optimism for continued improvement. Q: How are you thinking about the home health business's stability given potential population shifts between fee-for-service and Medicare Advantage (MA) plans? A: John Gochner, President and COO, highlighted that Pennant's locally driven model allows leaders to make referral acceptance decisions based on local staffing and reimbursement dynamics. The company has seen strong organic growth, with a 13.6% increase in Medicare referrals and a 9.9% increase in total admissions. While expecting more growth in MA and commercial plans, Pennant is investing in its service center to present a compelling story on clinical outcomes and efficiency to secure favorable rates. The company aims to be a solution for the community, supporting growth across both fee-for-service and MA patients. Q: What is your perspective on the sustainability of your Medicaid-weighted senior living business amid constrained Medicaid funding, and what advantages does it offer? A: Andy Rider, Senior Living President, stated that Pennant has developed strong relationships with managed care payers in states with higher Medicaid density. The company is selective about where it expands this offering, ensuring it protects margins. In states with established relationships, Pennant provides significant value and has been able to negotiate viable margins. While monitoring rate pressure, the company has not felt large effects in its major density areas, seeing stability in these programs. Q: How are you leveraging automation and AI to drive efficiencies, and what opportunities do you see over the next 12 to 24 months? A: Brent Garisoli, CEO, acknowledged that technology and AI are key focus areas, with significant investment underway. The company is piloting solutions to reduce clinician documentation time, improving their experience and productivity, which should increase patient capacity and care quality. Additionally, AI tools are expected to automate back-office manual processes, reducing indirect spend. While many initiatives are in development, the company expects improved quality and financial outcomes from these technology investments. Q: Do you believe the increased scrutiny on waste, fraud, and abuse in the hospice industry is accelerating market share shifts toward larger, more sophisticated providers, and are you benefiting? A: John Gochner, President and COO, confirmed that the enforcement environment is fundamentally different, with payment suspensions and audits causing providers and referral sources to be more cautious. This has created opportunities for Pennant, given its robust internal compliance program and ability to navigate audits, positioning it as a trusted provider. The company is focused on maintaining rigorous eligibility and compliance standards, which it believes will continue to drive market share growth. Q: Can you provide an update on cash flow, the elevated CapEx, and the increase in debt, and how are you prioritizing debt paydown versus growth investments? A: Lynette Waldom, CFO, stated that operating cash flow is on track to meet the raised guidance of up to $58 million, with some noise expected from acquisition transitions. The elevated CapEx is related to distressed senior living buildings acquired in late 2025, requiring investments to bring them up to standards, with annual CapEx expected to be $15-17 million. The increase in debt For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Conference Call and Webcast scheduled for tomorrow, August 6, 2026 at 10:00 am MT EAGLE, Idaho, Aug. 05, 2026 (GLOBE NEWSWIRE) -- The Pennant Group, Inc. (NASDAQ: PNTG), the parent company of the Pennant group of affiliated home health, hospice and senior living companies, today announced its operating results, reporting GAAP diluted earnings per share of $0.25 for the second quarter of 2026. Pennant also reported adjusted diluted earnings per share of $0.36 for the quarter(1). Second Quarter Highlights Total revenue for the second quarter was $298.0 million, an increase of $78.5 million or 35.8% over the prior year quarter; Net income for the second quarter was $9.1 million, an increase of $2.0 million or 28.2% over the prior year quarter; Adjusted net income for the second quarter was $12.8 million, an increase of $3.4 million or 36.5% over the prior year quarter; Consolidated Adjusted EBITDAR for the second quarter was $37.6 million, an increase of $9.4 million or 33.3% over the prior year quarter; Consolidated Adjusted EBITDA for the second quarter was $24.3 million, an increase of $7.9 million or 48.2% over the prior year quarter; Consolidated Adjusted EBITDA prior to NCI for the second quarter was $26.1 million, an increase of $8.8 million or 51.0% over the prior year quarter; Home Health and Hospice Services segment revenue for the second quarter was $237.8 million, an increase of $71.8 million or 43.2% over the prior year quarter; Home Health and Hospice Services segment adjusted EBITDAR from operations for the second quarter was $41.0 million, an increase of $13.3 million or 47.9% over the prior year quarter; segment adjusted EBITDA from operations for the second quarter was $37.7 million, an increase of $12.3 million or 48.2% over the prior year quarter; and segment adjusted EBITDA from operations prior to NCI for the second quarter $39.6 million, an increase of $13.2 million or 50.0% over the prior year quarter; Total home health admissions for the second quarter were 28,947, an increase of 11,115 or 62.3% over the prior year quarter; same store home health admissions for the second quarter were 17,854, an increase of 1,573 or 9.7% over the prior year quarter; total Medicare home health admissions for the second quarter were 11,916, an increase of 4,936 or 70.7% over the prior year quarter; same store Medicare home health admissions for the second quarter were 7,372, an increase of 883 or 13.6% over the prior year quarter; Hospice average daily census for the second quarter was 5,477, an increase of 1,568 or 40.1% compared to the prior year quarter; same store hospice average daily census for the second quarter was 4,089, an increase of 397 or 10.8% compared to the prior year quarter; Senior Living Services segment revenue for the second quarter was $60.2 million, an increase of $6.7 million or 12.6% over the prior year quarter; average occupancy for the second quarter was 78.9%, an increase of 10 basis points over the prior year quarter, same store average occupancy for the second quarter was 81.6%, an increase of 150 basis points over the prior year quarter, average monthly revenue per occupied room for the second quarter was $5,392, an increase of $204 or 3.9% over the prior year quarter, and same store average monthly revenue per occupied room for the second quarter was $5,413, an increase of $282 or 5.5% over the prior year quarter; Senior Living segment adjusted EBITDAR from operations for the second quarter was $16.0 million, an increase of $1.2 million or 7.9% over the prior year quarter; and segment adjusted EBITDA from operations for the second quarter was $5.8 million, an increase of $0.7 million or 13.2% over the prior year quarter. Operating Results “Pennant delivered another strong quarter, putting us on pace to exceed the top end of our original full year guidance,” said Brent Guerisoli, the Company’s Chief Executive Officer. “We are driving operational excellence across both segments, including at our recently-acquired operations in the southeast, even as we complete their integration. That process is unfolding ahead of our expectations, and we are now transitioning the two largest waves of operations, which we expect to fully complete by the middle of the fourth quarter.” “Our segments continue to deliver healthy growth,” said John Gochnour, the Company’s Chief Operating Officer. “We have been focused on operational excellence at every level, which is producing compelling clinical results and record financial performance. In the home health and hospice segment, years of rigorous investment and innovation helped us weather the challenging reimbursement environment of the last few years and now positions us to benefit from the more stable payment landscape that appears ahead. On the senior living side, our focus on finding and developing great leaders has enabled us to pursue numerous attractive acquisitions year-to-date, build out local care continuums, and continue to grow our real estate portfolio.” A discussion of the Company’s use of Non-GAAP financial measures is set forth below. Reconciliations of net income to EBITDA, adjusted EBITDAR, adjusted EBITDA, and adjusted EBITDA prior to NCI, as well as a reconciliation of GAAP earnings per share, net income to adjusted net earnings per share and adjusted net income, appear in the financial data portion of this release. More complete information is contained in the Company’s Form 10-Q for the three and six months ended June 30, 2026, which will be filed with the SEC and will be available to be viewed on the Company’s website at www.pennantgroup.com. 2026 Guidance Update Management is providing updating 2026 annual guidance as follows: total revenue is anticipated to be between $1,171.1 million and $1,190.1 million; full year 2026 adjusted earnings per diluted share is anticipated to be between $1.34 and $1.41; full year 2026 adjusted EBITDA is anticipated to be between $94.4 million and $98.0 million; and full year adjusted EBITDA prior to NCI is anticipated to be $101.5 million to $105.1 million. The Company’s updated 2026 annual guidance is based on diluted weighted average shares outstanding of approximately 37.0 million and a 26.0% effective tax rate. The guidance includes among other things, certain costs relating to our transition services agreement with UnitedHealth, reimbursement rate adjustments and no unannounced acquisitions. It excludes net income attributable to noncontrolling interest, the tax-effected costs at start-up operations, share-based compensation, acquisition-related costs, and gain (loss) on disposition of assets and impairments.     Lynette Walbom, the Company’s Chief Financial Officer, also stated, “We believe providing updated annual adjusted consolidated EBITDA guidance in addition to updated annual revenue and adjusted earnings per share guidance is helpful to understanding our expectations for our business and operational cash flow. This updated guidance reflects management’s expectations based on year-to-date performance and current operating conditions. Our guidance includes revenue in the range of $196.0 to $198.0 million, adjusted EBITDA in the range of $17.0 to $18.6 million, and adjusted EBITDA prior to NCI of $20.8 to $22.5 million relating to these former UnitedHealth and Amedisys assets.” Conference Call A live webcast will be held tomorrow, August 6, 2026 at 10:00 a.m. Mountain time (12:00 p.m. Eastern time) to discuss Pennant’s second quarter 2026 financial results. To listen to the webcast, or to view any financial or statistical information required by SEC Regulation G, please visit the Investors Relations section of Pennant’s website at https://investor.pennantgroup.com. The webcast will be recorded and will be available for replay via the website. About Pennant The Pennant Group, Inc. is a holding company of independent operating subsidiaries that provide healthcare services through 175 home health and hospice agencies and 69 senior living communities located throughout Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming. Each of these businesses is operated by a separate, independent operating subsidiary that has its own management, employees and assets. References herein to the consolidated "company" and "its" assets and activities, as well as the use of the terms "we," "us," "its" and similar verbiage, are not meant to imply that The Pennant Group, Inc. has direct operating assets, employees or revenue, or that any of the home health and hospice businesses, senior living communities or the Service Center are operated by the same entity. More information about Pennant is available at www.pennantgroup.com. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 This press release contains, and the related conference call and webcast will include, forward-looking statements that are based on management’s current expectations, assumptions and beliefs about its business, financial performance, operating results, the industry in which it operates and other future events. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding growth prospects, future operating and financial performance, and acquisition activities. They are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to materially and adversely differ from those expressed in any forward-looking statement. These risks and uncertainties relate to the company’s business, its industry and its common stock and include: reduced prices and reimbursement rates for its services; its ability to acquire, develop, manage or improve operations, its ability to manage its increasing borrowing costs as it incurs additional indebtedness to fund the acquisition and development of operations; its ability to access capital on a cost-effective basis to continue to successfully implement its growth strategy; its operating margins and profitability could suffer if it is unable to grow and manage effectively its increasing number of operations; competition from other companies in the acquisition, development and operation of facilities; its ability to defend claims and lawsuits, including professional liability claims alleging that our services resulted in personal injury, and other regulatory-related claims; and the application of existing or proposed government regulations, or the adoption of new laws and regulations, that could limit its business operations, require it to incur significant expenditures or limit its ability to relocate its operations if necessary. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the company’s periodic filings with the Securities and Exchange Commission, including its Form 10-Q and/or 10-K, for a more complete discussion of the risks and other factors that could affect Pennant’s business, prospects and any forward-looking statements. Except as required by the federal securities laws, Pennant does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release. Contact Information Investor RelationsThe Pennant Group, Inc.(208) [email protected] SOURCE: The Pennant Group, Inc. The following table summarizes our senior living performance indicators for the periods indicated: The following table summarizes our senior living performance indicators for the periods indicated: The table below reconciles Consolidated net income to the Consolidated Non-GAAP financial measure, Consolidated Adjusted EBITDA, and to the Non-GAAP valuation measure, Consolidated Adjusted EBITDAR, for the periods presented: The table below reconciles Consolidated net income attributable to The Pennant Group, Inc. to the Consolidated Non-GAAP financial measures, Consolidated Adjusted EBITDA and Consolidated Adjusted EBITDA prior to NCI, for the periods presented: The following tables present certain financial information regarding our reportable segments. General and administrative expenses are not allocated to the reportable segments: The table below provides a reconciliation of Segment Adjusted EBITDAR from Operations above to income from operations: The tables below reconcile Segment Adjusted EBITDAR from Operations to Segment Adjusted EBITDA from Operations for each reportable segment for the periods presented: Discussion of Non-GAAP Financial Measures EBITDA consists of net income, adjusted for net income attributable to noncontrolling interest (“NCI”), before (a) interest expense, net, (b) provisions for income taxes, and (c) depreciation and amortization. Adjusted EBITDA consists of net income attributable to the Company before (a) interest expense, net (b) provisions for income taxes, (c) depreciation and amortization, (d) results related to start-up operations, including rent and excluding depreciation, interest and income taxes, (e) share-based compensation expense, (f) non-capitalizable acquisition related costs, (g) activities associated with transitioning operations, (h) transition services costs, and (i) other unusual, non-recurring or redundant charges. Adjusted EBITDA prior to NCI consists of net income attributable to the Company before (a) interest expense, net (b) provisions for income taxes, (c) depreciation and amortization, (d) results related to start-up operations, (f) non-capitalizable acquisition related costs, (g) activities associated with transitioning operations, (h) transition services costs, (i) unusual, non-recurring or redundant charges, and (j) NCI. Consolidated Adjusted EBITDAR is a valuation measure applicable to current periods only and consists of net income attributable to the Company before (a) interest expense, net, (b) provisions for income taxes, (c) depreciation and amortization, (d) rent-cost of services, (e) results related to start-up operations, excluding rent, depreciation, interest and income taxes, (f) share-based compensation expense, (g) acquisition related costs, (h) activities associated with transitioning operations, (i) transition services costs, and (j) other unusual, non-recurring or redundant charges. The company believes that the presentation of EBITDA, adjusted EBITDA, adjusted EBITDA prior to NCI, consolidated adjusted EBITDAR, adjusted net income, and adjusted earnings per share provides important supplemental information to management and investors to evaluate the company’s operating performance. The company believes disclosure of adjusted net income, adjusted net income per share, EBITDA, adjusted EBITDA, adjusted EBITDA prior to NCI, and consolidated adjusted EBITDAR has economic substance because the excluded revenues and expenses are infrequent in nature and are variable in nature, or do not represent current revenues or cash expenditures. A material limitation associated with the use of these measures as compared to the GAAP measures of net income and diluted earnings per share is that they may not be comparable with the calculation of net income and diluted earnings per share for other companies in the company's industry. These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures. For further information regarding why the company believes that this non-GAAP measure provides useful information to investors, the specific manner in which management uses this measure, and some of the limitations associated with the use of this measure, please refer to the company's periodic filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Report on Form 10-Q. The company’s periodic filings are available on the SEC's website at www.sec.gov or under the "Financial Information" link of the Investor Relations section on Pennant’s website at http://www.pennantgroup.com.

Addus HomeCare (ADUS) came out with quarterly earnings of $1.73 per share, beating the Zacks Consensus Estimate of $1.69 per share. This compares to earnings of $1.49 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +2.37%. A quarter ago, it was expected that this provider of home-based personal care, nursing and rehabilitative therapy services would post earnings of $1.52 per share when it actually produced earnings of $1.62, delivering a surprise of +6.58%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Addus HomeCare, which belongs to the Zacks Medical - Outpatient and Home Healthcare industry, posted revenues of $377.42 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.56%. This compares to year-ago revenues of $349.44 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Addus HomeCare shares have added about 7.5% since the beginning of the year versus the S&P 500's gain of 9.4%. While Addus HomeCare has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Addus HomeCare was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.73 on $386.66 million in revenues for the coming quarter and $6.98 on $1.52 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Outpatient and Home Healthcare is currently in the top 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, The Pennant Group, Inc. (PNTG), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 5. This company is expected to post quarterly earnings of $0.33 per share in its upcoming report, which represents a year-over-year change of +22.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. The Pennant Group, Inc.'s revenues are expected to be $288 million, up 31.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Addus HomeCare Corporation (ADUS) : Free Stock Analysis Report The Pennant Group, Inc. (PNTG) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

As the Q1 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the senior health, home health & hospice industry, including The Pennant Group (NASDAQ:PNTG) and its peers. 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 satisfactory Q1. As a group, revenues beat analysts’ consensus estimates by 0.9%. In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results. 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 $283.5 million, up 35.7% year on year. This print exceeded analysts’ expectations by 1%. Overall, it was a satisfactory quarter for the company with a beat of analysts’ EPS estimates. “Pennant is off to a strong start in 2026,” said Brent Guerisoli, the Company’s Chief Executive Officer. The Pennant Group pulled off the fastest revenue growth of the whole group. Unsurprisingly, the stock is up 3.9% since reporting and currently trades at $33.79. Is now the time to buy The Pennant Group? Access our full analysis of the earnings results here, it’s free. Founded in 1974, BrightSpring Health Services (NASDAQ:BTSG) offers home health care, hospice, neuro-rehabilitation, and pharmacy services. BrightSpring Health Services reported revenues of $3.61 billion, up 25.6% year on year, outperforming analysts’ expectations by 6.3%. The business had an exceptional quarter with a beat of analysts’ EPS and revenue estimates. BrightSpring Health Services delivered the biggest analyst estimate beat among its peers. The market seems happy with the results as the stock is up 34.8% since reporting. It currently trades at $64.65. Is now the time to buy BrightSpring Health Services? Access our full analysis of the earnings results here, it’s free. With a nationwide network of 177 locations serving 43 states and a team of over 4,500 clinicians, Option Care Health (NASDAQ:OPCH) is the largest independent provider of home and alternate site infusion services, delivering medications and clinical support to patients across the United States. Option Care Health reported revenues of $1.35 billion, up 1.3% year on year, falling short of analysts’ expectations by 3.3%. It was a slower quarter as it posted full-year revenue guidance missing analysts’ expectations. Option Care Health delivered the highest full-year guidance raise but had the weakest performance against analyst estimates in the group. As expected, the stock is down 19.6% since the results and currently trades at $21.59. Read our full analysis of Option Care Health’s results here. With a network of over 650 communities serving approximately 59,000 residents across 41 states, Brookdale Senior Living (NYSE:BKD) operates senior living communities across the United States, offering independent living, assisted living, memory care, and continuing care retirement communities. Brookdale reported revenues of $764.9 million, down 6% year on year. This number missed analysts’ expectations by 0.8%. Taking a step back, it was a satisfactory quarter as it also recorded a beat of analysts’ EPS estimates but a slight miss of analysts’ revenue estimates. Brookdale had the slowest revenue growth among its peers. The stock is down 2.9% since reporting and currently trades at $13.78. Read our full, actionable report on Brookdale here, it’s free. 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 $657.5 million, up 1.6% year on year. This result beat analysts’ expectations by 1.2%. Overall, it was a strong quarter as it also recorded a beat of analysts’ EPS and revenue estimates. The stock is up 13.3% since reporting and currently trades at $433.81. Read our full, actionable report on Chemed here, it’s free. Late in 2025 into early 2026, there was hand-wringing around artificial intelligence. For software companies, the fear was that AI would erode pricing power and compress margins as new tools made it easier to replicate what once required expensive enterprise platforms. Crypto investors had their own version of the same anxiety: if AI agents could trade, allocate capital, and manage wallets autonomously, what exactly was the long-term value of today’s crypto infrastructure? These concerns triggered a noticeable rotation away from these sectors and into safer havens. But markets rarely dwell on one narrative for long. Spring 2026 came, and the focus shifted abruptly from technological disruption to geopolitical risk. The US’ conflict with Iran became the dominant driver of market psychology, and when geopolitics takes center stage, the script changes quickly. Investors stop debating growth rates and start worrying about oil supply, inflation, and global stability. Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. 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In recent days, The Pennant Group, Inc. received an upgrade to a Zacks Rank #2 (Buy), reflecting a shift toward higher analyst earnings estimates and a more favorable assessment of its near-term outlook. This upgrade highlights how changing expectations for Pennant’s earnings power can influence perceptions of its underlying business quality and future prospects. We’ll now explore how this earnings estimate upgrade could affect Pennant Group’s existing investment narrative and risk‑reward profile. Capitalize on the AI infrastructure supercycle with our selection of the 47 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow. To own Pennant Group, you need to believe in a long-term shift toward home health, hospice, and senior living, supported by solid execution on recent acquisitions and cost control. The Zacks Rank #2 (Buy) upgrade points to improving earnings expectations, which could reinforce confidence in Pennant’s near term earnings power. It does not, however, materially change the biggest near term swing factors: how Pennant manages labor costs and any eventual impact from the proposed 2026 CMS home health rule. The most relevant recent development is Pennant’s Q1 2026 report, with sales of US$285.36 million and net income of US$8.52 million. Those results, alongside earlier 2025 guidance of US$911.4 million to US$948.6 million in full year revenue, form the base that analysts are now revising higher. The earnings estimate upgrade effectively sits on top of this operating trend and will likely be interpreted next to Pennant’s continued acquisition activity and growing debt load. Yet against this improved earnings outlook, investors should be aware of how exposed Pennant still is to future CMS reimbursement cuts and... Read the full narrative on Pennant Group (it's free!) Pennant Group's narrative projects $1.3 billion revenue and $68.1 million earnings by 2029. This requires 10.9% yearly revenue growth and about a $38.5 million earnings increase from $29.6 million today. Uncover how Pennant Group's forecasts yield a $38.17 fair value, a 19% upside to its current price. While consensus focuses on steady growth and reimbursement risk, the most optimistic analysts saw Pennant reaching about US$1.3 billion in revenue and US$60 million in earnings before this upgrade, so this new earnings momentum could either reinforce or challenge those more aggressive views depending on how sustainable you think it really is. Explore 5 other fair value estimates on Pennant Group - why the stock might be worth over 2x more than the current price! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Pennant Group research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision. Our free Pennant Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Pennant Group's overall financial health at a glance. Right now could be the best entry point. These picks are fresh from our daily scans. Don't delay: Invest in the nuclear renaissance through our list of 88 elite nuclear energy infrastructure plays powering the global AI revolution. Rare earth metals are the new gold rush. Find out which 31 stocks are leading the charge. We've uncovered the 10 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include PNTG. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

The Pennant Group’s first quarter was met with a positive market response as the company’s non-GAAP profit exceeded expectations, despite revenue coming in slightly below analyst forecasts. Management attributed the quarter’s performance primarily to operational improvements within newly acquired businesses, ongoing integration in the Southeast, and margin stability across both the Home Health and Senior Living segments. CEO Brent Guerisoli highlighted the company’s ability to rebound from seasonal and weather-related disruptions, noting, “We have successfully rebounded and increased total census above the levels at the time of acquisition.” Leadership development and local operational autonomy were also emphasized as key drivers of ongoing margin improvement. Is now the time to buy PNTG? Find out in our full research report (it’s free). Revenue: $283.5 million vs analyst estimates of $280.7 million (35.7% year-on-year growth, 1% beat) Adjusted EPS: $0.32 vs analyst estimates of $0.31 (4.9% beat) Adjusted EBITDA: $21.71 million vs analyst estimates of $21.48 million (7.7% margin, 1.1% beat) Operating Margin: 6.1%, in line with the same quarter last year Sales Volumes fell 3.3% year on year (28.9% in the same quarter last year) Market Capitalization: $1.23 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. Brian Tanquilut (Jefferies) asked about the cadence of integration and margin impact from Southeast acquisitions. President John Gochnour emphasized that transition service agreement costs should fall as integration concludes and systems adoption accelerates. Raj Kumar (Stephens) questioned the drivers behind strong same-store Medicare admissions. Gochnour explained that local market execution and being the preferred provider have enabled Pennant to win share in a shifting competitive landscape. David MacDonald (Truist) inquired about payer negotiations and the impact of regulatory focus on fraud and abuse. CEO Brent Guerisoli described positive progress with national payers and suggested increased industry scrutiny could open new opportunities for compliant providers. Benjamin Hendrix (RBC Capital Markets) asked about hospice CAP management in competitive markets. Management acknowledged pressures in high-reimbursement states like California but pointed to robust tracking systems and local best practices as key mitigation tools. Jared Haase (William Blair) sought clarity on same-store margin improvement levers. Gochnour cited efficiency gains from technology, better care planning, and operating leverage as main contributors. In future quarters, our analyst team will monitor (1) the pace and effectiveness of Southeast integration, particularly as transition service costs decline, (2) improvements in occupancy and margin recovery in newly acquired Senior Living communities, and (3) the impact of evolving payer contracts and joint ventures on revenue mix. Execution on these milestones and the ability to sustain operational discipline during regulatory scrutiny will be crucial for tracking Pennant’s progress. The Pennant Group currently trades at $35.36, up from $32.53 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week - FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.

Interested in The Pennant Group, Inc.? Here are five stocks we like better. Pennant Group posted a strong Q1 2026, with revenue up 36% year over year to $285.4 million and adjusted diluted EPS rising 18.5% to $0.32, driven by growth in home health, hospice and improving senior living margins. The Home Health and Hospice segment was the main growth engine, as revenue climbed 43.3% and admissions surged, while management said integration of more than 50 newly added operations is still weighing on margins temporarily. Senior Living continued to improve, with revenue up 12.6% and adjusted EBITDA margin expanding to 11.8%; Pennant also completed four acquisitions after quarter end and plans to keep focusing on integration while maintaining full-year guidance. 3 Small Cap Stocks That May Someday be Large Caps The Pennant Group (NASDAQ:PNTG) reported a sharp increase in first-quarter 2026 revenue and adjusted earnings as growth in its home health and hospice business, continued senior living margin improvement and ongoing integration of newly added operations helped drive results. Chief Executive Officer Brent Guerisoli said the company delivered “another excellent quarter,” citing revenue of $285.4 million, up 36% from the prior-year quarter. Adjusted EBITDA rose 32.6% to $21.7 million, while adjusted EBITDA prior to noncontrolling interests increased 37.2% to $23.5 million. Adjusted diluted earnings per share were $0.32, up 18.5% year over year. → Insider Sales: Top AST SpaceMobile Insider Cuts Postion Over 30% Guerisoli said Pennant is focused in 2026 on improving operating performance after what he described as “dramatic acquisitional growth” in 2025. He said same-store segment adjusted EBITDA margins are on an upward trajectory and pointed to leadership development as a key driver of the company’s ability to absorb recent growth. President and Chief Operating Officer John Gochnour said Pennant’s Home Health and Hospice segment generated revenue of $229.1 million in the quarter, an increase of $69.2 million, or 43.3%, from the prior-year period. Segment adjusted EBITDA rose 33.7% to $33.6 million, while adjusted EBITDA prior to noncontrolling interests increased 36.6% to $35.4 million. → Light Speed Returns: Corning Cashes In on NVIDIA Growth Total home health admissions reached 30,721, up 62.7% year over year, while Medicare home health admissions rose 75.1% to 13,303. Same-store home health admissions increased 5.8%, and same-store Medicare admissions grew 9.2%. Hospice also posted growth, with average daily census reaching 5,199, up 37% from the prior-year quarter. Same-store hospice average daily census increased 10.2% to 3,952. → Years in the Making, AMD’s Upside Movement Has Just Begun Gochnour attributed the results to clinical outcomes, payer relationships and local leaders’ ability to serve as trusted community resources. He said same-store segment adjusted EBITDA margin prior to noncontrolling interests improved 110 basis points to 17.2%, despite a 1.3% reduction in the Medicare home health base rate and ongoing wage pressure. Overall Home Health and Hospice segment adjusted EBITDA margin prior to noncontrolling interests declined 70 basis points to 15.5%, which management said reflected the expected impact of integrating more than 50 new operations and temporary costs tied to a transition services agreement. Management spent much of the call discussing the integration of home health, hospice and home care operations in Tennessee, Alabama and Georgia. Guerisoli said two of five operational waves have been fully transitioned into Pennant’s systems, with the process expected to continue through October. Gochnour said the company has begun the third wave, with the third and fourth waves representing the largest parts of the integration effort. He said the company expects the bulk of the transition work to occur in the second quarter and early third quarter, with expenses dropping as operations move off the transition services agreement and onto Pennant’s systems. Guerisoli said the company has successfully increased total census above the levels at the time of acquisition, despite challenges including electronic medical record transition disruption, lower seasonal admissions over the holidays and severe weather in January. “We don’t want to declare victory just yet,” Guerisoli said during the question-and-answer session, adding that the company wants another quarter of results before considering any changes to guidance. Pennant did not adjust its full-year guidance, though Guerisoli said management would “point you to the upper end” of the guidance range. Pennant’s Senior Living segment reported revenue of $56.3 million, up 12.6% from the prior-year quarter. Adjusted EBITDA rose 30.6% to $6.4 million, and segment adjusted EBITDA margin improved 190 basis points to 11.8%. Same-store occupancy increased 180 basis points to 81%, while all-store occupancy was 78.6%, up 10 basis points year over year. Gochnour said all-store occupancy declined 200 basis points sequentially, driven largely by recent acquisitions of low-occupancy communities and typical holiday seasonality. After quarter end, Pennant completed four senior living acquisitions. On April 1, the company acquired the operations and real estate of Lavender Lane Senior Living, which includes 43 assisted living and memory care units and 25 independent living units in the Phoenix area. On May 1, three additional communities joined Pennant through triple-net leases: a 100-unit community in Glendale, Arizona, now operating as Saguaro Senior Living, and two Wisconsin communities now operating as Cardinal Lane Senior Living and Harbor Haven Senior Living. Andrew Ryder, President of Pennant’s Senior Living segment, said the newly acquired senior living assets have “pretty large upside” but are largely distressed assets. He said the company expects some lumpiness in occupancy and margins during integration but sees long-term opportunity. Chief Financial Officer Lynette Walbom said GAAP net income rose 9.6% to $8.5 million, while adjusted net income increased 19.8% to $11.5 million. GAAP diluted earnings per share were $0.24, up 9.1% from the prior-year quarter. At quarter end, Pennant had $72 million outstanding on its revolving line of credit and $98.8 million outstanding on its term loan, for total borrowings of $178.8 million under its credit facility. The company had $4.9 million in cash on hand and a net debt to adjusted EBITDA ratio of 1.93 times. Cash flows used in operations were $3.4 million, an improvement of $17.8 million compared with the prior-year quarter. In response to an analyst question, Walbom said capital expenditures are expected to be heavier in the first part of the year and likely to total $15 million to $18 million for the full year. In the question-and-answer session, Guerisoli said Pennant’s broader geographic footprint has helped make the company a more natural partner for large payers. He said the company is seeing progress in managed care discussions, including better contracts and “Medicare-like reimbursement,” supported by clinical performance. Gochnour also addressed increased government focus on waste, fraud and abuse in health care. He said Pennant has invested in an “industry-leading compliance program” and that every provider number undergoes a claims audit and on-site review annually. He said enforcement actions in some markets, including California and Arizona, have created opportunities for established providers with strong clinical and compliance records. On hospice regulation, Gochnour noted that the proposed 2026 hospice rule includes a 2.4% increase to the hospice daily rate, which he said aligns with Pennant’s guidance assumptions and could provide a tailwind in the fourth quarter. Management also said it continues to evaluate home health and hospice tuck-in acquisitions and potential joint ventures with integrated health systems, while maintaining integration of the Southeast operations as its primary focus. The Pennant Group (NASDAQ: PNTG) is a publicly traded holding company that provides specialized services to the asset management industry. Through its operating subsidiaries, the company delivers outsourced fund administration, securities lending, prime brokerage, and capital markets solutions designed to support hedge funds, private equity firms, mutual funds and other institutional investors. By leveraging a combination of technology platforms and industry expertise, The Pennant Group helps clients streamline middle- and back-office processes, enhance operational efficiency and manage regulatory requirements. Key service offerings include fund accounting and reporting, trade settlement and reconciliation, risk monitoring, securities lending programs and execution support across a range of asset classes. The article "The Pennant Group Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.

Image source: The Motley Fool. Thursday, May 7, 2026 at 12 p.m. ET Chief Executive Officer — Brent Guerisoli President and Chief Operating Officer — John Gochnour Chief Financial Officer — Lynette Walbom President, Senior Living Segment — Andy Rider General Counsel — Kirk Cheney Need a quote from a Motley Fool analyst? Email [email protected] Kirk Cheney: Thank you, Michelle. Welcome, everyone, and thanks for being with us today. Joining me are Brent Guerisoli, our CEO; John Gochnour, our President and COO; Lynette Walbom, our CFO; and Andy Rider, President of our Senior Living segment. Before we get started, I have a few housekeeping items. Yesterday, we filed our earnings press release and Form 10-Q. The release is posted in the Investor Relations section of our website at www.pennantgroup.com. A replay of today's call will also be available on our website until 5:00 p.m. Mountain Time on May 6, 2027. We also want to remind anyone listening by replay that all statements are made as of today, May 7, 2026, and we do not intend to update these statements after this call. In addition, any forward-looking statements we make today reflecting management's current expectations, assumptions and beliefs regarding our business and the operating environment. These statements involve risks and uncertainties that may cause actual results to differ materially from those expressed or implied. Listeners should not place undue reliance on forward-looking statements and should review our SEC filings for a fuller discussion of factors that could affect our results. Except as required by federal securities laws, Pennant and its affiliates undertake no obligation to publicly update or revise any forward-looking statements due to new information, future events, changing circumstances or otherwise. Further, The Pennant Group, Inc. is a holding company and does not have direct operating assets, employees or revenues. Certain independent subsidiaries, collectively referred to as the service center, provide administrative services to our other operating subsidiaries pursuant to contractual arrangements. Reference is dependent. The company, we are and us meeting The Pennant Group, Inc. and its consolidated subsidiaries. Each of our operating subsidiaries and the service center is operated as a separate independent company with its own management team, employees and assets. Accordingly, references in this presentation to the consolidated company and its assets and activities as well as the use of we, us, are and similar terms should not be understood to suggest that The Pennant Group, Inc. directly employs operating personnel or that any subsidiary is directly operated by The Pennant Group. We also supplement our GAAP results with certain non-GAAP measures. We believe these measures when considered alongside our GAAP results can help provide a more complete view of our performance. However, they should not be considered in isolation or as a substitute for GAAP reporting. A reconciliation of GAAP to non-GAAP measures is included in yesterday's press release and is also available in our 10-Q. With that, I'll turn the call over to our CEO, Brent Guerisoli. Brent? Brent Guerisoli: Thanks, Kirk. Good morning, everyone, and welcome to our first quarter 2026 earnings call. To start, I want to acknowledge the dedication of Pennant's people through different cycles and environments, during rapid growth, changing macroeconomic conditions and more, our teams consistently rise to meet the moment. I am proud to work alongside you. We're pleased to report another excellent quarter with strong results across our businesses, including revenue of $285.4 million, up $75.5 million or 36%; adjusted EBITDA of $21.7 million, up $5.3 million or 32.6%; adjusted EBITDA prior to NCI of $23.5 million, up $6.4 million or 37.2%; and adjusted diluted earnings per share of $0.32, up $0.05 or 18.5% each over the prior year quarter. Across both segments, we continue to build momentum and drive relentless operational improvement. As we've discussed on prior calls, 2025 was a year of dramatic acquisitional growth. And in 2026, we are committed to improving our operational performance in both new and mature operations. One clear indication of progress is our same-store segment adjusted EBITDA margins, which are on a substantial upward trajectory as we deliver exceptional results for patients, attract the best leaders and create a culture of excellence in our agencies and communities. We will continue to unlock meaningful value in our operations. A key to our success, as we have repeatedly emphasized, is attracting and developing exceptional leaders. Without this focus, the type of growth we have experienced would not have been possible. The large acquisitions we completed in 2025 called upon us to stretch our leadership recruitment and development muscles like never before. We rose to the challenge. In 2025, we added 101 CEOs and training to our development program, and we have followed with 47 more in 2026 year-to-date. Also in 2025, we elevated 11 local CEOs and 24 other local C-level leaders. Our leadership pipeline remains robust and positions us well for additional growth in the future. With the addition of leaders recognized thus far in 2026, we now have 55 CEOs and 92 other C-level leaders in operations, driving our results across the business. The transition of Tennessee, Alabama and Georgia operations from UnitedHealthcare continues to progress. We have transitioned 2 of 5 operational waves fully into our systems and we'll continue this process through October. As this occurs, we anticipate improved operational performance and incremental reduction in expenses, including those under the transition services agreement. The leaders of each agency continue to work closely in clusters with experienced tenant partners to unleash the full potential of our locally driven operating model. Despite the anticipated challenges of maintaining census during an EMR transition, lower seasonal admission trends over the holidays and severe weather events in January, we have successfully rebounded and increased total census above the levels at the time of acquisition. Even as we continue to implement our systems and operating model and anticipate some additional disruption, we are pleased that the transition is progressing consistent with our expectations. The future is bright for Pennant in the Southeast. In sum, the first quarter was a tremendous start to the year, and we are well situated to deliver positive results throughout 2026 and beyond. With only one quarter behind us and substantial additional transition work on the near horizon, we are not adjusting guidance at this time, but would point you to the upper end of our guidance range. Now I'll turn the call over to John Gochnour, our President and COO, to share additional details on our first quarter operating performance. John? John Gochnour: Thank you, Brent, and good morning to everyone on the call. I'm pleased to report strong first quarter performance across both operating segments, driven by our continued focus on operational excellence, margin improvement, organic growth, clinical excellence and leadership development. Our Home Health and Hospice segment extended its exceptional growth trajectory, delivering quarterly revenue of $229.1 million, an increase of $69.2 million or 43.3% over the prior year quarter. Segment adjusted EBITDA of $33.6 million, up $8.5 million or 33.7%. And segment adjusted EBITDA prior to NCI of $35.4 million, up $9.5 million or 36.6%, each over the prior year quarter. This performance reflects consistent growth in existing operations and effective transitions in our newer operations. Total Home Health admissions reached 30,721, an increase of 62.7% while Medicare Home Health admissions rose to 13,303, an increase of 75.1%, each over the prior year quarter. These strong total growth metrics include same-store admission growth of 5.8% and same-store Medicare admission growth of 9.2%, each over the prior year quarter. Our Hospice business also continued its robust growth. Average daily census reached 5,199, an increase of 37%. And same-store hospice average daily census grew to 3,952, an increase of 10.2%, each compared to the prior year quarter. This momentum is driven by strong clinical outcomes, including positive reimbursement adjustments based on our Home Health value-based purchasing performance, deepening relationships with payers and our local leaders' ability to serve as trusted community resources for patients, employees and partners, even amidst significant transition activity and despite a 1.3% reduction in our Medicare Home Health base rate and continued wage pressure on the labor front. Our local leaders focus on operational excellence drove same-store segment adjusted EBITDA margin prior to NCI to 17.2%, a 110 basis point improvement over the prior year quarter. Overall, segment adjusted EBITDA margin prior to NCI, decreased to 15.5%, 70 bps, reflecting the expected impact of transitioning more than 50 new operations to our systems and the temporary higher cost of the ongoing transition services agreement. The new store margin performance was consistent with the expectations we set out in our guidance. And as Brent noted, as we fully integrate our new operations and talented local teams adopt our operating model, we expect these operations and our total segment margins to move toward our 18% target, though progress will not be immediate or perfectly linear. On the regulatory front, in April, we received the proposed 2026 hospice rule, which includes a 2.4% rate increase to the hospice daily rate. This aligns with our guidance assumptions and should provide an additional tailwind in the fourth quarter. Our Senior Living segment also delivered meaningful progress. Revenue of $56.3 million, increased $6.3 million or 12.6%. Adjusted EBITDA of $6.4 million, increased $1.5 million or 30.6%. And segment adjusted EBITDA margin improved to 11.8%, a 190 basis point increase, each over the prior year quarter. Since the pandemic, we have steadily expanded segment margin into the double digits with significant opportunity remaining. Same-store occupancy rose to 81%, up 180 basis points, while all store occupancy reached 78.6%, up 10 basis points, each over the prior year quarter. Sequentially, we saw a 200 basis point decline in our all store occupancy, which was driven almost entirely by our recent acquisitions of low occupancy communities along with some typical holiday-related seasonality. We have seen a rapid rebound from the holiday seasonality and expect some continued volatility in our all-store occupancy as we add underperforming, but high potential Senior Living communities to our portfolio. Turning to growth. We completed the transition of 54 Home Health, Hospice and Home Care operations in Tennessee, Alabama and Georgia in the fourth quarter of 2025. Throughout quarter 1, our service center and segment leaders dedicated substantial time to integrating these operations into our systems and the unique tenant operating model. As Brent described, results have been consistent with our expectations, and we anticipate completing the transition by the end of the third quarter. We are very excited about the progress and the potential to unlock significant value in these operations and as we grow in the Southeast. While integration remains our primary focus, we continue to evaluate a pipeline of Home Health and Hospice tuck-ins and potential joint ventures with integrated health care systems. As we find opportunities that meet our disciplined criteria and will not distract from our integration efforts, we expect to pursue them in the coming months. In Senior Living, we completed 4 acquisitions after quarter end. On April 1, 2026, we acquired the operations and real estate of Lavender Lane Senior Living, which includes 43 assisted living and memory care units and 25 independent living units. This addition strengthens our growing Phoenix area portfolio where we have deep leadership talent and a robust continuum of care across Home Health, Hospice, Home Care and Senior Living. Additionally, on May 1, 2026, a Three more senior living communities joined Pennant through triple net leases with trusted capital partners, a 100-unit community in Glendale, Arizona, now operating at Saguaro Senior Living and 2 Wisconsin communities, 45 units and 50 units now operating as Cardinal Lane Senior Living and Harbor Haven Senior Living. These additions further expand our presence in 2 of our most strategic markets. We continue to review multiple Senior Living opportunities. and supported by strong operational performance and investments in leadership development, expect to remain active acquirers throughout the year. With that, I'll turn the call over to Lynette to walk through the financial results. Lynette? Lynette Walbom: Thank you, John, and good morning, everyone. Additional detail on our financial performance for the 3 months ended March 31, 2026, is included in the Form 10-Q and press release filed yesterday. Some additional highlights for the quarter compared to the prior year quarter include the following: GAAP revenue of $285.4 million, an increase of $75.5 million or 36%; GAAP net income of $8.5 million, an increase of $0.7 million or 9.6%, 'adjusted net income of $11.5 million, an increase of $1.9 million or 19.8%; GAAP diluted earnings per share of $0.24, an increase of $0.02 or 9.1%; and adjusted diluted earnings per share of $0.32, an increase of $0.05 or 18.5%. Additional selected metrics for the 3 months ended March 31, 2026, include $72 million outstanding on our revolving line of credit and $98.8 million outstanding on our term loan for a total of $170.8 million outstanding under our credit facility. We had $4.9 million in cash on hand at quarter end and a net debt to adjusted EBITDA ratio of 1.93x. Cash flows used in operations were $3.4 million, an improvement of $17.8 million versus the prior year quarter. I'd now like to highlight a few leaders across our organization who have delivered exceptional outcomes. Their examples illustrate the meaningful progress that can occur when local leaders build strong cultures and develop high-performing teams of C-level leaders within their operations. Riverside Home Health and Hospice and Grants Pass Oregon is led by Chief Executive Officer; Will Johns, Chief Marketing Officer, Sabrina Zage; and future CCOs, Jennifer Doman and Heather Raj. Riverside is a provider of choice in Southern Oregon with a Home Health star rating of 4.5 stars, Hospice composite score of 100% and Hospice visits in the last day of life of 84% versus the national average of 48%. This clinical quality has resulted in exceptional financial performance. Since taking the helm in 2024, Will and the Riverside team have doubled revenue from $2.5 million in Q1 2024 to $5 million in Q1 2026. Tripled EBITDA and improved agency level operating margin by more than 1,100 basis points over the same period. With a broad rural service area, Riverside story demonstrates once again that our unique operating model can support tremendous success outside of large population centers. And Home Health and Hospice are critical components in the health care continuum and rural communities. At Capitol Hill Senior Living, newly appointed CEO, Rodney Washburn; and CCO, Britanee Plascencia; and CMO, Roxy Romero, provided carrying an attractive home for over 100 residents in downtown Salt Lake City. With low turnover, and high employee satisfaction, it is clear that Capitol Hill's culture contributes to a positive resident experience. As a result, occupancy has increased over 2,300 basis points. Revenue has increased 46% and EBITDA has increased over 238% each over the prior year quarter. Capitol Hill was one of our first real estate acquisitions, which we purchased in 2024 and as an underperforming asset in an attractive location for a compelling price. By improving the operations, the Capitol Hill team has now added value to the operation to the real estate and most importantly, to the residents and community. With strong demand for its services, Capitol Hill is now adding units to its upper floor, further expanding the business' financial opportunity going forward. With that, I'll hand the call back to Brent for closing remarks. Brent Guerisoli: Thanks, Lynette. As we wrap up, I want to again thank our operators, clinicians and service center partners who like the individuals highlighted, provide truly life-changing service to our patients and residents every day. We are grateful for all you do. With that, we'll open the line up for questions. Michelle, would you please provide the audience with the Q&A instructions? Operator: [Operator Instructions] And our first question is going to come from Brian Tanquilut with Jefferies. Brian Tanquilut: Congrats on a good quarter. So maybe I'll start. If you can speak to the integration progress that you're seeing with the Amedisys United assets and how should we think about the cadence of kind of like the impact of that on margins for the remainder of the year? And then if you can share with us kind of like KPIs and labor and payer retention? Just think along those lines. John Gochnour: Brian, thanks for the question. And like as Brent stated in the call, we're really excited about where we stand in the integration to date. We have been able to move through the first 2 waves of our integration process, moving those agencies onto our systems. We've begun the third wave. The third and fourth wave are the largest of the 5 waves. And so we're sort of in the heart of getting those operations over. We have been in the process of moving through the leadership development aspect. In some cases, that has meant leaders that came into our program in Q4 and even earlier made it through our CEO development program and have now been placed as executive directors. In other cases, we found some really amazing and talented people in Visa Metasys and United locations, who qualified for our CIT program and have either begun training or have already completed training in our unique operating model and stepped in as Executive Directors and future CEOs. So we're really excited about where we stand on kind of those 2 fronts. From a KPI standpoint, as Brent mentioned in the call, we have rebounded during the transition period as we guided and sort of according to our expectations, we expect modest blips in the census as we transition the EMR. We experienced those and have rebounded, particularly in those agencies where we have completed the integration. We also made it through a unique January where, in addition to the typical holiday seasonality, you saw some winter storms in Tennessee in particular, that really prevented us from admitting patients. And so it's really great to see that census above where it was. As far as margin goes, we're really right on target. We have the added costs as we've telegraphed of transition services agreement in addition to the system transitions, which take a lot of training time, take people out of the field from delivering care, but we've got an amazing team providing that support. And so we see a lot of opportunity as those transition services agreement costs roll off. As folks roll into our systems as we improve clinical outcomes and continue to deliver for that margin improvement, that we've sort of built into our guide to occur throughout the year. So that's a little bit about the KPIs we're looking towards. Brian Tanquilut: No, that's really helpful. Maybe just a follow-up on that. As I think about the CapEx spend for the quarter, obviously, a little bit of elevation here as you built the infrastructure here in the South. So just curious how we should be thinking about CapEx trend over the course of the year? Brent Guerisoli: We talked in the call earlier about some of the acquisitions that we had come on at the end of Q4 for the Senior Living side. Some of those were having significant CapEx spend in the first part of the year. And so I think we will see heavier spend in the first part of the year with CapEx spend probably ending up in that $15 million to $18 million for the year. Brian Tanquilut: Got it. And then maybe my last question, if you don't mind. As I think about where the hospital stands today, whether it's the team model being rolled out for some of the JVs that you've announced. I mean how do we think about the receptivity of the hospital population, especially with -- in the markets that you're in to sign JVs with you guys on the Home Health side? John Gochnour: We've had now 6 years of experience working in joint ventures with premier integrated health care systems. And through that, we've built a track record of being able to help them take generally underperforming parts of their business that are critical to their continuums of care, right? They need to decamp the hospital in many cases so that they can take higher acuity patients. They need chronic condition patients to receive the care in the home that keeps them out of the hospital. And so we've been able to partner with them in building really effective home health programs, hospice programs that reduce their mortality rates, that improve their readmission rates and return to acute rates. And so -- as a result, we -- there's a lot of receptivity out there. I think as hospitals have experienced some of the struggles that we've all in health care experienced from a labor standpoint as there need to pull acuity and serve those most acute patients that can only receive care in that setting, they've seen the value of partnering with an expert partner. And we think we've built a pretty impressive track record of being that partner. And so as I talked about in the call, those conversations are ongoing. We're a very disciplined partner, and we don't move faster than we're able. And so we're not out talking to every health care system in the country and say, we'll do this for you, we'll do this for you. But when we see the right situation with the right partners with the kind of commitment to clinical excellence, financial performance and the development of excellent culture, we're going to take advantage of those opportunities and partner to create special joint ventures. Operator: And the next question come from Raj Kumar with Stephens. Raj Kumar: Maybe I just wanted to look at some of the same-store trends in Home Health. Medicare admission growth continues to be strong. Just wanted curious to see what you're seeing at the market level in terms of if it's a function of just enrollment shift dynamics kind of given MA tapping out from a mix perspective relative to the entire Medicare population or if it's still just a gradual kind of more idiosyncratic market-level wins from a referral standpoint. And maybe if you've seen any acceleration on that front as you kind of get more ingrained within your markets? John Gochnour: It's a great question, Raj. And I think we're still a little bit early to see how sort of some of those macroeconomic factors are affecting that number. What we're seeing is we're continuing to be chosen. Our goal in every operation is to create the provider of choice and the employer of choice in the community. And when we're able to attract the talent and we have the staff, we have the opportunity to serve those communities. And I think our local teams and our local leaders have executed in an extraordinary way. Our model is built around the idea that we can be the solution of choice. And I think as you've seen some adjustment in the marketplace, you've got several of our largest competitors who have become affiliated with one provider that's less space for an independent provider with extraordinary clinical outcomes and commitment to local communities to step in and execute. And so I think those are macroeconomic trends that we're watching. Is this sort of a longer-term trend where there's more patients that are on the traditional Medicare that are participating in traditional Medicare? And therefore, we will see our mix start to shift back the other direction? Or is this short-term sort of market share execution? But we're very optimistic and really pleased with just the way we're being chosen in the community and the growth that it's helping us drive. Raj Kumar: Great. And then maybe kind of thinking about Hospice and look at the same-store growth trends there. I think there's a pretty wide graph between ADC and total admit. So just kind of curious on that front, where do you think -- are you kind of comfortable with the length of stay profile that you have right now, maybe anything around CAP? And then incrementally, I guess, anything you've kind of seen on the fuel front, any kind of headwinds from that kind of macroeconomic pressure to call out? Or anything that you kind of foresee or embed within the kind of maintained guidance? John Gochnour: Yes. From a hospice ADC standpoint, like we called out in the script, I think we had a 10.2% improvement in ADC even as we had softer admission trends overall, we have a discharge length of stay that actually decreased. But of course, length of stay is a factor of those patients that are coming on service, and we continue to improve relationships across the continuum of care, which we think is part of what's driving that impressive increase in same-store hospice ADC. It's really about execution. It's really about delivering exceptional care and the community choosing us and giving us the opportunity to serve patients. I think one of the macro trends I would point to, there was just data released in the last few weeks that showed that when patients elect hospice 5 days earlier, it can save the Medicare Trust Fund $1.5 billion. And that just goes to show that as we do a better job educating, as we do a better job partnering and collaborating with referral sources and get people on to hospice sooner, that benefit has the potential to be a solution to some of our Medicare Trust Fund rose. On the cap side, we saw a significant reduction quarter-over-quarter in -- or I should say, over the prior year quarter in CAP. And we continue to work on that. That really is a local situation. Some of our agencies, particularly in California, the reimbursement is higher than the CAP allows. And so they're only able to provide care for a certain number of days. That's going to continue to be something that we're watching very closely. But what I think I would call out is we've had excellent partnership with our expert finance resources in the service center. They built models that help our local executive directors understand where they sit relative to CAP limitation and understand from a business development perspective, how to partner with, shorter length of stay, referral sources where they can navigate that mix and make sure that we don't get caught in those CAP situations. And finally, on the fuel situation. I think that's -- again, another macroeconomic indicator that is early in the process. Certainly, if gas prices stay elevated the way they are, we'll begin providing what we've done in the past is we've provided stipends or we've adjusted our mileage rates to account for that to make sure that our employees are not left in bad situations. Currently, we still view this as a short-term flux. And so we're watching that closely, but we hope that it's going to pass and that as things settle down over in the Middle East that there's going to be a retreat in gas prices. So we're not building into our current comments on guidance, significant fuel expense or mileage increases. Operator: And our next question will come from David MacDonald with Truist. David MacDonald: Congratulations. Just a couple of questions. I guess, first, just at a high level, I was wondering if you guys could talk about just conversations with payers, any early conversations around just the expansion into the Southeast, some of the opportunities that you're seeing there? And then secondly, I was wondering if you could also comment just on the increased market focus on waste, fraud and abuse and what that may mean around market share gain opportunity over time. Brent Guerisoli: Yes. Great question, Dave. So I'll take the question on the payer front. So one of the things that we have seen is as we've expanded, obviously, in the Southeast, we've got relationships in the Northeast. We've become much more of a natural player. So we've also progressed a lot of the conversations with these big payers on a broader basis. And the other thing that we've done is we've made significant investment in that -- in our team to help in that regard, and we're making a ton of progress there. So we're in -- I would say this is an ongoing conversation, but it's been really positive. And ultimately, what our payer partners are looking for is somebody that can be consistent and provide high quality of care. And so from the beginning, we've talked about the importance of our clinical product and the quality solutions we're providing at the local communities, but that's also expanding to the national communities as well. And so it is creating a significant opportunity for us. And even with some of the managed care conversations, we have consistently seen positive results in terms of getting better contracts, getting Medicare-like reimbursement. And so we expect that to continue as we make these investments as we expand across the country and also as we continue to perform well clinically. John Gochnour: And David, I'll just take the fraud, waste and abuse question. I think this is a really unique time. We have an administration that is commendably very focused on rooting out fraud, waste and abuse, particularly from our industries. And we're grateful -- we've been grateful for the opportunity that we've had to have a voice and to partner in that effort. I think some of the tools that they are using or thinking of using are fairly blunt instruments. And we continue to encourage a nuanced approach to that dialogue. But what we do see is a couple of different things. First, we feel like we're differentiated in -- if we have a provider number under review or where there's a question in a community, we have invested heavily in developing an industry-leading compliance program where every one of our provider numbers undergoes and audit every year. We are -- and that's a claims audit. It is an on-site audit. So there's a very thorough review process. The second thing I'd say is, as there's been, particularly, for example, in California or Arizona, where there's been aggressive enforcement action, that's opened up new opportunities or reopened opportunities for our agencies that are long-standing parts of those communities that have delivered excellent clinical quality, deep compliant partnership. And so there's opportunities for us as bad actors are sort of rooted out. And so we see that as a potential opportunity. At the same time, we will continue to work closely to have a voice with the administration through our partner -- through our industry partnerships with the alliance to make sure that there is nuance and there is thoughtfulness in how we continue to root out fraud, waste and abuse. But we think at the end of the day, this is a commendable effort because it will result in the dollars that are there for our Medicare Trust Fund beneficiaries going to providers who are delivering exceptional care, high-quality clinical outcomes and improving the lives of the patients we serve. David MacDonald: Okay. And then just appreciate that. And then just 1 quick follow-up on integration timing. I think, John, you said 2 of the 3 large -- the 2 largest of the remaining 3 waves you guys are integrating right now. So just when we think about pacing between now and October when you finish up, is it fair to assume that the bulk of the heavy lifting is going to be done in the second quarter and then it ramps down somewhat noticeably from there? John Gochnour: Yes. I think you're going to see the heart of it is really this third and fourth wave. The third wave has already begun. The fourth wave is coming. And so I think through the second quarter and the early -- very early part of the third quarter is when the bulk of it is going to -- the bulk of the transition is going to occur. And then we would expect September and October, really, we're just going to be winding down that final wave. And so you'll start to see TS expenses significantly drop, and you'll start to see the opportunity for those agencies and local teams to use our systems to improve their clinical, financial and community results. Operator: And the next question is going to come from Ben Hendrix with RBC Capital Markets. Benjamin Hendrix: Just wanted to quickly follow up on the hospice discussion from earlier. I sound like you guys have some really strong systems in place for monitoring CAP. But one of your competitors in the past decided competition for short stay admissions as a headwind when it comes to CAP management. Are there any particular markets that you're operating in right now where even if you are monitoring the CAP dynamic, you could have a heightened competition that could kind of box you out of a short-stay admission access that could be a headwind? Unknown Executive: Yes. I mean that's always going to be the case, especially in markets with higher reimbursement. So California would be an example of that in our case. So -- and really, what it boils down to is you think about our model, again, John referenced this. There are going to be CAP pressures depending upon the local operation. And so -- but in those operations, they're coming up with multiple different tactics, right? And one of those things is finding those short length of stay. But really, it boils down to ensuring that the patient appropriateness and that those teams are very proactive in having a robust outreach to the entire community. And so I mean, there are a number of different ways to attack the CAP. The most important thing, though, is that we're tracking it at every single operation, every team is aware of their circumstances. And there are best practices out there to help them to drive improvement there. Benjamin Hendrix: Great. And then shifting over to senior housing. I was just wondering if you could talk about some of your newer acquisitions, kind of the status of those of those assets. Kind of how much quality improvement you expect to get out of those and kind of where you could take the performance of those new platforms? Unknown Executive: Yes. Thanks for the question, Ben. This is Andy. I think we're pretty excited about the latest group of acquisitions that we're currently integrating and also the ones that we brought on towards the end of last year all have pretty large upside but are pretty much all distressed assets. And so as we step in, there's always going to be lumpiness both in occupancy in the new store margin and just some of the pressures that exist with integrating these types of opportunities. On the long haul, they have tremendous upside. We're getting favorable pricing, and we're really excited about kind of the long-term view and we're getting better. The past couple of years, we've had some opportunity to integrate and to kind of get our hands dirty and learn. And so as we continue to go through the process, we're getting better and better, and those turns are happening faster and coming together. I think the story Lynette highlighted at Capitol Hill, Senior Living is a good example of what we can do in a couple of years' time over an 8-quarter period or so in really transforming an operation and getting it up to our standards. And so yes, this last -- this group that we just brought on, we're excited to roll up our sleeves and get to work. Operator: And the next question will come from Stephen Baxter with Wells Fargo. Stephen Baxter: Good to hear the guidance pushing towards the upper end. I was hoping to get a little bit more color on that one. I guess first, when we think about the first quarter, it sounds like you probably outperformed maybe your internal expectations. So I guess I'm wondering how much of the sort of nudge up on the guidance is really just flowing through the first quarter upside? And is there any element of carrying anything about the first quarter forward into the rest of the year? Whether that's maybe better same-store growth in Home Health and Hospice or maybe better same-store margins that you've made some effort to highlight? Brent Guerisoli: Yes, Stephen, I'll let Lynette speak maybe a little on the more detailed aspects of the guidance. But what I would just say is as we've integrated these new businesses in the Southeast, with any transition, there is going to be some lumpiness in results. And as you think about the various waves, especially where we're in Wave 3 and we're going into Wave 4, we feel really good about where we stand. We're, what, 7 months into the transition, but we don't want to declare victory just yet, right? And so we're seeing the progress. We'd really like to get another quarter under our belts before we make any adjustments because this next quarter will be kind of very insightful in terms of where we're going to end up through the end of the year. So that's part of the reason why we're just holding out. And we'll look, obviously, based on performance through the end of Q2 to make adjustments if that's appropriate. Lynette Walbom: I'd say talking more specifically about some of the same store, we continue to expect that same-store improvements that we've made in this quarter to continue. And just that performance of those existing operators, they're hitting their stride on really making sure that they're trying to drive in every way possible, additional margin to the bottom line. But again, as Brent said, we'll give you further updates as to guidance probably in Q2. Brent Guerisoli: Yes. And to that point, I might just add 1 additional. Like one of the things -- and I think we've shared this in the past, but -- the way that we do the integrations is we support them with other operations, other clusters or partners scattered across the organization. And so it was really -- that's why our same-store results in Q1 were even that more impressive is because that was in the midst of a reduction in our Home Health reimbursement. And all of this additional support going into our -- the transition in the Southeast yet. Our current operators continue to perform really well. And so that's a good sign that we're able to integrate and keep the kind of that momentum of operations going forward. So again, we just want to get a little bit more experience with this transition before we make any changes. Operator: [Operator Instructions] The next question is coming from Jared Haase with William Blair. Jared Haase: I'll actually maybe stick with the point that you just alluded to in sort of the impressive margin performance on a same-store basis. But I wanted to ask about that because I think you mentioned the sort of same agency prior to NCI was up, I think, 110 basis points year-over-year. And so I just wanted to kind of understand specifically where you're finding the biggest levers for operating leverage, again, considering that there's maybe a little bit of duplicative work related to the transition. And I also heard you call out where there's still some pressures on the labor side. So I just wanted to kind of understand, again, what's working from an efficiency standpoint that's driving that same agency margin? John Gochnour: Yes. Thanks, Jared. I appreciate the question. And I think what we're most excited, Brett highlighted some of the headwinds that we faced. But what's been most impressive is, I think our model is about -- it's about people and it's about ownership and it's about owning things at the local level and having cluster partners that care deeply about each other, diving in and helping each other. And I think there's been a few things certainly from an efficiency standpoint that have helped drive that. One is we were able to offset some of that revenue decline through strong performance in Home Health value-based purchasing. We've been able to move from a business development standpoint when we ask every operation to come up with their plan for how they would offset the initial 6-plus percent. The client that was proposed. Part of it was how do we work in the community more effectively? How do we work with institutional partners? How do we get early referrals? And in those areas, we saw significant improvement this quarter. And so we were able to see some meaningful same-store revenue per episode growth, even though we faced the base rate decrease. On the efficiency side, though, we saw exceptional care planning. The utilization of best practices, our clinical team has been working relentlessly to make our EMR more efficient to allow our nurses and our other clinicians to spend their time with the patient and to cut the amount of time that it takes them to document while still ensuring that everything is documented and shown as is required by regulation. And so we saw some meaningful progress there. That allowed us to reduce visits per episode in a pretty meaningful way. And so we are continuing to see better productivity, reduced visits per episode. We're managing the revenue side as well in a meaningful way. And so I think that's really where you see margin driving. And then, of course, we view this as a single segment. And so when you see some of that improvement, we view each local team as building a continuum. So often they have Home Health and Hospice together. So sometimes when you face Home Health pressure, if you can grow your Hospice, census in your Hospice business that can help you offset some of those cuts as well. And so the strong ADC growth also helped to drive same-store margin improvement. Brent Guerisoli: Yes. And Jared, I would just add 1 additional element. We've talked about this in the past. The tools and the resources available at our -- our local team is the technology stack that we have available to us, those are some of the elements that are helping our teams to get better information and understand how to drive efficiencies in their business. And certainly, as we look forward, the continued investment in technology and creating solutions that will allow us to efficiently drive positive outcomes. That's a big emphasis for us. And it will continue to be in the future because as we all know, this reimbursement environment can be difficult. And so we're looking to the future to provide opportunities for each of our local teams to be as efficient, but as effective as possible. Jared Haase: Got it. That's super helpful. And then I'll just ask 1 quick follow-up on the Senior Living segment. We've seen the Medicaid mix tick up just a little bit over the last couple of quarters, and we certainly saw that again. I think it was maybe plus 300 basis points year-over-year. So just wanted to ask if there were any call-outs as to what specifically was driving that? And then just what are your latest thoughts about the durability of some of the Medicaid waivers that are out there in light of potential for same budget over the next couple years? John Gochnour: Yes. Great question. I think we like was just highlighted on the Home Health and Hospice side. Similarly on the Senior Living side, we push operators to drive and to make plans to connect with their local government agencies and to understand all of the opportunities out there and serve the populations that need the assistance regardless of payer source. They're responsible for the financial outcomes. And so it's very driven at a local level. From a kind of a broad senior housing environment, we're seeing kind of the Class A properties really from a pricing standpoint accelerate. And so we're playing a lot in the kind of Class B or Class C space in terms of acquisitions. And so we may see some of that continue to tick up. But we continue to adjust state by state depending on how the -- what the pressures look like. We have seen just a little bit of some of the pressures from the administration's push against kind of fraud, waste and abuse. But by and large, I think we're really confident in the Medicaid programs and in the areas that we specifically play in, in the Medicaid programming. They all save the state significant money. We're a low-cost provider in terms of the services that we render. It's the lower cost of care along the continuum. We can help both prevent and reduce hospitalization. And ultimately, we're one of the -- we believe we're one of the better options in terms of being fiscally responsible from a government standpoint. And so we're confident, we're excited about the continued growth in kind of any area of our business as we continue to pull on those levers and empower our local operators to make the right financial decisions to drive margin growth and to take care of the residents there. Brent Guerisoli: Yes. And Jared, I would just maybe expound a little bit more on the waiver programs. Oftentimes, these are seen as sort of negative or less than from a reimbursement perspective. But what we found in many of the states that we work that these programs are actually -- have healthy reimbursement or appropriate reimbursement for the services that are provided. And so in some ways, it's actually driving some of our acquisition strategy. So in the case of Wisconsin and Arizona where we've just acquired new buildings, we have a great relationship with the state and the payers in the state. And so that's why you can see the -- our turnarounds that Andy alluded to earlier, why they're going so quickly or so much better as we can come in. And there's a need. That's the other thing about this population. It's a very vulnerable population. And in many cases, the states are looking for solutions to place these residents that are very vulnerable. And so we can acquire these buildings come in and be a solution because we take those waivers. They're already prenegotiated rates so we know what we're getting as soon as we step into those buildings. And it becomes a great opportunity for us to quickly expand and improve occupancy and create a benefit in the communities where we enter into. Operator: I am showing no further questions in the queue at this time. I will now turn it back over to Brent for closing remarks. Brent Guerisoli: Well, thank you, Michelle, and thank you, everyone, for joining us on the call today. Have a great day. 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