Why Acadia Healthcare Company Inc. Is Falling Today
What happened
Shares of Acadia Healthcare Company Inc. (NASDAQ: ACHC), a leading provider of psychiatric and chemical dependency services, fell as much as 13% on Monday. Shares were down about 9% as of 3:21 p.m. EST. The drop can be traced to the publication of a research report by a group of analysts.
So what
News broke today that analysts at Cantor Fitzgerald recently reaffirmed their "hold" rating on Acadia's stock. The analysts also released a near-term price target of $39.00.
In the report, analysts stated that they rated Acadia as neutral because of the "uncertainty associated with the recovery of its U.K. business." The company's U.K. business accounts for about 40% of sales, so the analysts felt it was prudent to be more cautious on the stock.
Image source: Getty Images.
Canto's price target of $39 represents a double-digit-percentage decline from Friday's closing price of $44.75. Shares are taking a step back today in response to the mildly bearish report.
Now what
The last few years haven't been kind to Acadia's shareholders. The stock is now down about 50% from its all-time high that was reached in 2015, so it's been a trying time for investors.
After today's bashing, the stock now trades for less than 15 times next year's earnings estimates. With current estimates calling for double-digit profit growth over the next five years, it's possible that Acadia might be a value stock that is worth considering.
More From The Motley Fool
Brian Feroldi has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
