Aveanna Healthcare Holdings Inc. (AVAH): what the price assumes

In the published model solve dated 2026-Q2, anchored at $13.55, Aveanna Healthcare Holdings Inc. (AVAH) is priced for +14.8% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-09-07 · Exported: 2026-09-09 · Source: https://boothcheck.com/report/AVAH

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 10.3% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: n/a

Valuation X-Ray

The price is supported by asset-based and relative-multiple and growth-DCF value, while earnings-power lands below the price. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Asset, Relative, Growth Families that call it expensive: Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.8%); the inversion above states its own rate.

Per-Model Detail (n=14)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Bullet Takeaways

• Private duty nursing, hourly skilled care delivered inside the patient's own home, is 82% of revenue, and the payer base behind it is described in the 10-K as more than 1,500 distinct payers that include Medicaid managed care organizations across 38 states.
• Gross debt of $1.32 billion leaves operating profit covering the interest bill about 1.9 times, so a year of flat reimbursement rates would be felt by equity holders long before it troubled a lender.
• The next thing to watch is preferred-payer conversion inside the nursing segment, and how quickly the 27 Family First Homecare locations bought in June 2026 settle onto Aveanna's own rate structure.

Bull Case

One spread decides this business. On one side is what a payer will pay for an hour of skilled nursing delivered in a patient's home. On the other is what it costs to put a licensed practical nurse in that home for that hour. Widen the spread and the model compounds quietly; narrow it and extra volume rescues nothing, because every additional hour is bought with the same scarce nurse.

In the fiscal year ended January 3, 2026 the spread widened. Consolidated revenue reached $2.43 billion against $2.02 billion a year earlier, and private duty services carried 82% of the total. The smallest of the three lines shows the mechanic stripped of everything else: medical solutions grew 6.6%, and the 10-K attributes that to a 7.7% increase in revenue rate, offset by a decline in volume of 1.1%. Fewer patients served, more revenue collected. That is pricing, and pricing is the harder thing to win when the customer is ultimately a state government.

Winning it depends on being large enough that a payer would rather negotiate than replace you. Aveanna sells into an unusually fragmented payer base, and its own filing treats the fragmentation as protection rather than friction: Each contract we have with our payers is unique and specific to that payer, creating additional diversification. No single contract loss is existential, and the nursing panel that serves those contracts is the asset a rival cannot simply buy, because the constraint on the industry is nurses rather than capital.

The second lever is what else can travel down the same visit. Aveanna delivers enteral nutrition products into households its nurses already attend, and management's argument for that combination is operational rather than promotional: the bundling of these services provides families with not only a more convenient "one stop shop" but also a more responsive, tailored service experience due to the ability of Aveanna nurses to manage patients' enteral shipments from the home. A products line attached to a visit that was happening anyway carries almost no incremental cost of delivery.

The result shows up where it should. Against the listed home-care and post-acute cohort, Aveanna's roughly 10.5% operating margin compares well: ADUS earns 9.8%, ENSG 8.5%, OPCH 5.8% and BTSG 2.7%, with only CON higher at 15.6% on a very different occupational-health mix. And the commercial momentum is being negotiated, not bought. Four new preferred-payer agreements were signed in the March quarter, lifting preferred-payer volume inside private duty services to roughly 60%. Rate wins of that kind persist in a way that acquisition-driven revenue does not.

Bear Case

Almost every dollar this company collects is set by someone who is neither the patient nor the company. Rates come from state Medicaid programs, from the managed care organizations that administer them, and from Medicare. That is not a detail of the model, it is the model, which makes the variable with the most leverage over this equity a legislative one.

The 10-K is unusually specific about the direction of travel, listing among the changes it must absorb a reduction of funding for states choosing to expand the state's Medicaid program, and updated eligibility requirements for Medicaid beneficiaries, which include more onerous Medicaid eligibility verifications. Tighter eligibility checks do not cut the rate per hour. They cut the number of hours anyone is entitled to, which is the same thing arriving through a different door. The managed care channel carries its own version: the filing warns that results could be materially affected if these organizations terminate us as a provider and/or engage our competitors as a preferred or exclusive provider.

Now put that against what the price asks for. Today's quote works out to roughly 12.7 times trailing operating profit, and it implies operating profit compounding around 7.1% a year over a five-year stretch before settling into ordinary long-run growth. Taken alone that is a mild requirement, well inside what the last two years delivered. What makes it fragile is the structure underneath it. Net debt of $1.13 billion is 4.4 times operating profit, and operating profit covers the interest bill about 1.9 times. At that level of cover, the first several points of reimbursement pressure land on the residual claim rather than on the lenders, and the residual claim is the equity.

The cost side offers no natural offset, because the labor market Aveanna buys in is not its own. The filing states plainly that The majority of our HHH and PDN caregivers are licensed practical nurses ("LPN") and we compete for this labor pool both with competitors in our private duty services industry as well as other healthcare organizations outside our industry, including hospitals. Hospitals set wages against acute-care economics; a home-nursing provider paid on a Medicaid schedule has to match those wages out of a fixed rate. When the two move at different speeds, the spread that drives the whole thesis closes from the wrong side.

Nor has the equity been left undisturbed while this plays out. The share count has risen about 4.6% a year across the last four years, so holders have been carrying leverage and dilution at once. The company's own indebtedness disclosure names the consequence: borrowings limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate; and place us at a competitive disadvantage compared to competitors that have less indebtedness. The bull answer is that rates have been rising and the preferred-payer strategy is winning them, and that is fair. It is also worth remembering when those wins were negotiated, and what the filing itself says about where state budgets are heading.

Valuation

Begin with what is actually being paid. At $9.45 the market values the enterprise at roughly 12.7 times trailing operating profit, and that multiple implies operating profit compounding near 7.1% a year over a five-year stretch before fading to ordinary long-run growth. Set against the multiples the other listed home-care and post-acute filers carry, that sits in the lower half of the range. The bet embedded here is not heroic growth.

The methods used to triangulate the business disagree, and the shape of the disagreement is the useful part. Peer multiple approaches land above today's quote. So do the cash flow approaches, and so do most of the book value and profitability approaches. The exception is earnings power measured with no growth at all: take the average operating profit of the last five fiscal years, assume the business never expands again, and today's price is about 5 times what that earnings power method reaches. That is a coherent story rather than a contradiction. A levered enterprise whose operating profit is assumed frozen forever cannot support much equity, and freezing operating profit is exactly what the company is not doing.

What has to be true, then, is modest on the income statement and demanding on the balance sheet. Aveanna earns roughly a 10.5% operating margin today, which is respectable inside its cohort: ADUS runs at 9.8%, ENSG at 8.5%, OPCH at 5.8% and BTSG at 2.7%. Holding that margin while growing mid single digits is the whole requirement. The complication is that the requirement has to be met while servicing debt priced off a floating benchmark. The 10-K discloses that the 2025 Term Loan and borrowings under the 2025 Refinancing Revolving Credit Facility each accrued interest at a rate of 7.47%, and that the 2025 term loans bear interest at a rate equal to, at the election of the Borrower, Term SOFR (as defined in the Amended Credit Agreement) plus an applicable margin equal to 3.75 % per annum.

That is where the read tightens. Net debt of $1.13 billion sits at 4.4 times operating profit against gross debt of $1.32 billion and liquid assets of $189 million, and operating profit covers interest about 1.9 times. The company is not burning cash, which matters, but the share count has drifted up about 4.6% a year over the last four years, so the equity has been absorbing dilution alongside the leverage. Cheap against most of the methods and thinly covered against its own interest bill is an unusual pairing. It puts the weight of the decision not on the multiple, which is undemanding, but on whether the reimbursement rates that produced this year's operating profit hold at these levels.

Catalysts

The March quarter was the strongest print the company has posted since it listed. Revenue came in at $647.9 million, up 15.9% on the prior-year quarter, and net income was $41.7 million against $5.2 million a year earlier. The scale of that swing in reported profit says more about how much of the cost base is fixed than about any single quarter's demand: on 16% more revenue, an operating structure built for hourly nursing converts incremental rate almost straight through.

The second development is structural rather than seasonal. Aveanna completed the purchase of Family First Homecare for $175.5 million in cash on June 2, 2026, adding 27 pediatric home-nursing locations, and lifted full-year 2026 revenue guidance to a range of $2.63 billion to $2.65 billion from $2.56 billion to $2.58 billion, of which about $70.0 million is attributed to the acquired business. Paying cash rather than issuing stock is the relevant detail for holders who have watched the share count climb; it also means the deal was funded from a balance sheet that was already carrying meaningful debt.

What follows is a test of integration rather than of demand. The acquired locations sit in states where Aveanna already negotiates, so the question is how quickly they move onto the parent's contracted rates and staffing model. The 10-K flagged the transaction while it was still pending, noting that The purchase price for the acquisition is $175.5 million in cash, subject to customary adjustments. The next scheduled read on both the rate trajectory and the integration is the second-quarter report.

Peer Cohorts (Per Segment, With Filing Citations)

Private Duty Services (reported)

• ADUS (Addus HomeCare Corp)
• FY2025 10-K: …who require long-term care and assistance with activities of daily living to maintain their independence at home with their families. Personal care services are a significant component of home and community-based services ("HCBS"), which have grown in significance and demand in recent years. In particular, the demand…
• FY2025 10-K: …oral care, feeding and dressing, medication reminders, meal planning and preparation, housekeeping and transportation services. Many consumers need such services on a long-term basis to address chronic or acute conditions. Our personal care segment also includes staffing services, with clients including assisted…
• BTSG (BrightSpring Health Services, Inc.)
• FY2025 10-K: …the governmental taxing authorities. The Company's revenue recognition policy by reportable segment is as follows: Pharmacy Solutions Pharmacy Solutions revenues are generated from the products and services provided in association with the distribution of prescription drugs to consumers primarily under contracts with…
• FY2025 10-K: . We bill our private pay consumers for services rendered weekly, bi-monthly or monthly. Other private payors include workers' compensation programs/insurance, preferred provider organizations, and employers. Supply In our Pharmacy Solutions segment, we have purchased some of the generic and brand pharmaceuticals that…
• ENSG (ENSIGN GROUP, INC)
• FY2025 10-K: …to maintain readiness and resiliency while regularly reviewing policies in the interest of protecting data security. External companies or agencies may be called upon to provide consulting, guidance, assistance, or some other form of support in response to a cybersecurity incident. The regular training of employees,…
• FY2025 10-K: …services are included in the per diem payment. For beneficiaries who do not meet the coverage criteria for Part A services, rehabilitation services may qualify for the services to be provided under Medicare Part B. Managed Care and Private Insurance - Managed care patients consist of individuals who are insured by…
• PACS (PACS Group, Inc.)
• FY2025 10-K: …care, assisted living, and independent living options in some of our communities. As of December 31, 2025, our portfolio consisted of 321 post-acute care, assisted living, and independent living facilities across 17 states serving over 31,700 patients daily. We believe our significant historical growth has been…
• FY2025 10-K: …it adjusts these estimates, which would affect net service revenue in the period such variances become known. The Company maintains a refund liability for consideration collected related to revenue that is not probable that a significant revenue reversal will not occur. The Company expects to refund some or all of…
• CON (CONCENTRA GROUP HOLDINGS PARENT, INC.)
• FY2025 10-K: …occupational health risks (such as musculoskeletal injury and effects of hazardous exposure), and support employers' efforts to effectively manage healthcare and workers' compensation costs. The structure of pricing and reimbursement for employer services is different from that of our workers' compensation services.…
• FY2025 10-K: …the employee. Our streamlined approach helps ensure prompt and appropriate treatment and continuity of care for better clinical and cost containment outcomes. While we operate an extensive national occupational health center network, we are independent of hospital systems and outside physician groups. This allows…

Home Health & Hospice (reported)

• EHC (Encompass Health Corporation)
• FY2025 10-K: …to repurchase shares. • We may be unable or unwilling to continue to declare and pay dividends on our common stock. The cautionary statements referred to in this section also should be considered in connection with any subsequent written or oral forward-looking statements that may be issued by us or persons acting on…
• FY2025 10-K: …offices is (205) 967-7116. Our website address is www.encompasshealth.com. In addition to the discussion here, we encourage the reader to review Item 1A, Risk Factors , Item 2, Properties, and Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations , which highlight additional…
• CHE (CHEMED CORPORATION)
• FY2025 10-K: …to settlements of audits and reviews, as well as certain hospice-specific revenue capitations. Amounts are generally billed monthly or subsequent to patient discharge. Subsequent changes in the transaction price initially recognized are not significant. Hospice services are provided on a daily basis and the type of…
• FY2025 10-K: …to hospices will not decrease. Reductions in amounts paid by government programs for services or changes in methods or regulations governing payments could cause VITAS' net patient service revenue and profits to materially decline. 15% to 20% of VITAS' days of care are provided to patients who reside in nursing…
• BTSG (BrightSpring Health Services, Inc.)
• FY2025 10-K: …integration and business synergy across the Provider Services segment. The divestiture will also augment the Company's expected Revenue and Adjusted EBITDA growth rates and maximize exposure to target growth markets that require the Company's needed and valuable solutions, such as home health, rehab, primary care,…
• FY2025 10-K: …of the Community Living business, we believe the Company's streamlined service offerings will result in increased strategic focus, operational efficiencies, a refined payer mix, and greater clinical integration and business synergy across the Provider Services segment. The divestiture will also augment the Company's…
• ADUS (Addus HomeCare Corp)
• FY2025 10-K: …oral care, feeding and dressing, medication reminders, meal planning and preparation, housekeeping and transportation services. Many consumers need such services on a long-term basis to address chronic or acute conditions. Our personal care segment also includes staffing services, with clients including assisted…
• FY2025 10-K: …assistance with activities of daily living, primarily to persons who are at increased risk of hospitalization or institutionalization, such as the elderly, chronically ill or disabled. In its hospice segment, the Company provides physical, emotional and spiritual care for people who are terminally ill as well as…
• ENSG (ENSIGN GROUP, INC)
• FY2025 10-K: …healthcare provider referral laws that go beyond physician self-referrals or apply to a greater range of services than just the designated health services under the Stark Law. Regulations Regarding Patient Record Confidentiality Health care providers are also subject to laws and regulations enacted to protect the…
• FY2025 10-K: …and Human Services (HHS), Office of the Inspector General (OIG), state Medicaid agencies, state Attorney Generals, local and state ombudsman offices and the Centers for Medicare and Medicaid Services (CMS) Recovery Audit Contractors, among other agencies. In response to the inquiries, investigations and audits,…

Medical Solutions (reported)

• ADUS (Addus HomeCare Corp)
• FY2025 10-K: …assistance with activities of daily living, primarily to persons who are at increased risk of hospitalization or institutionalization, such as the elderly, chronically ill or disabled. In its hospice segment, the Company provides physical, emotional and spiritual care for people who are terminally ill as well as…
• FY2025 10-K: …oral care, feeding and dressing, medication reminders, meal planning and preparation, housekeeping and transportation services. Many consumers need such services on a long-term basis to address chronic or acute conditions. Our personal care segment also includes staffing services, with clients including assisted…
• BTSG (BrightSpring Health Services, Inc.)
• FY2025 10-K: …and clinical and regulatory education and support for our customers, and they are designed to provide a consistent, best in-class experience for customers accompanied by local concierge support. Centralized intake and order entry drives consistency across operations and markets. Our pharmacy services are all…
• FY2025 10-K: …and benefits for direct care and service professionals, contracted labor costs, insurance costs, transportation costs for clients requiring services, certain client expenses such as supplies and medicine, residential occupancy expenses, which primarily comprise rent and utilities, and other miscellaneous direct goods…
• OPCH (OPTION CARE HEALTH, INC.)
• FY2025 10-K: …and local levels places it in a strong position against existing and potential competitors. Intellectual Property Option Care Health and its subsidiaries own a variety of trademarks, licenses, and service marks, including but not limited to: "Option Care Health", "Option Care", "Critical Care Systems", "Clinical…
• FY2025 10-K: …which the Company operates, certain estimates are required to record revenue and accounts receivable at their net realizable values at the time goods or services are provided. Inherent in these estimates is the risk that they will have to be revised or updated as additional information becomes available. The Company…
• CON (CONCENTRA GROUP HOLDINGS PARENT, INC.)
• FY2025 10-K: …Excellence" and "Our Competitive Strengths-High-Quality Care and Clinical Outcomes". Injury care Our affiliated physicians and other clinicians are qualified to treat most work-related, non-life-limb-eyesight-threatening conditions including, but not limited to, back injuries, injuries from falls or lifting,…
• FY2025 10-K: …strategic vision, and we continue to make advancements by introducing key technologies that focus on delivering an exceptional colleague and customer experience. One example is the Concentra HUB, our robust occupational health customer portal, which makes it easier and more convenient for employers, insurance…
• ENSG (ENSIGN GROUP, INC)
• FY2025 10-K: , reviews segment income for each operating segment to evaluate performance and allocate capital resources. For more information about our operating segments, as well as financial information, see Part II., Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations and Note 7,…
• FY2025 10-K: …and patient transportation to people in their homes or at long-term care facilities. To date, these businesses were not meaningful contributors to our operating results. GROWTH We have an established track record of successful acquisitions. Much of our historical growth can be attributed to implementing our expertise…
• PACS (PACS Group, Inc.)
• FY2025 10-K: …care, assisted living, and independent living options in some of our communities. As of December 31, 2025, our portfolio consisted of 321 post-acute care, assisted living, and independent living facilities across 17 states serving over 31,700 patients daily. We believe our significant historical growth has been…
• FY2025 10-K: …and clinicians. Value Proposition for Patients and Families • Coordinated care. We empower team members at every level through skillful training, shared resources, and a collaborative spirit. We help deliver coordinated care before, during, and after a patient's stay with us. Prior to admission, our administrators or…
• NHC (NATIONAL HEALTHCARE CORP)
• FY2025 10-K: …competitive with other market rates. ● Medical Specialty Units. All our skilled nursing facilities participate in the Medicare program, and we have expanded our range of offerings by the creation of facility-specific medical specialty units such as our memory care units and sub-acute nursing units. Our trained staff…
• FY2025 10-K: …rental income, management and accounting services fees, insurance services, and costs of the corporate office. See Note 5 in the notes to the consolidated financial statements for further disclosure of the Company's operating segments. Customers and Sources of Revenues No individual customer, or related group of…
• SNDA (Sonida Senior Living, Inc.)
• FY2025 10-K: …that this trend should increase the demand for our senior housing communities, including our assisted living and memory care communities. Cost-Containment Pressures In response to rapidly rising health care costs, governmental and private pay sources have adopted cost containment measures that have reduced admissions…
• FY2025 10-K: …by health care professionals to keep residents informed about health and disease management. Subject to applicable governmental regulations, personal care and medical services are available to independent living residents through either the community staff or through independent home care agencies. 5 Table of…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.