Aveanna Healthcare (AVAH) 46th Annual William Blair Growth Stock Conference summary

Strategic transformation and growth

• Achieved 14 consecutive quarters of beating and raising expectations, with ongoing momentum into 2026.

• Revenue CAGR of nearly 10% over six years, primarily organic, while reducing leverage from over 11x to under 3.8x since late 2022.

• Recent acquisitions, including Family First and Thrive Pediatrics, have strengthened presence in key states like Florida and Texas.

• Updated 2026 guidance: revenue raised to $2.63–$2.65 billion and adjusted EBITDA to $338–$342 million, reflecting acquisition impact.

• National footprint expanded, with payer diversification ensuring no single payer exceeds 10% of revenue.

Preferred payer and government affairs strategy

• Preferred payer strategy aligns clinical capacity with MCOs and government partners offering above-market reimbursement and wages.

• By Q1 2026, 34 preferred payers in Private Duty Services (PDS), covering about 60% of MCO volume, up from 7 payers and 15% in 2022.

• Targeting 80–85% of MCO volume with preferred payers in PDS over the next 3–5 years.

• Value-based agreements provide upside-only bonuses tied to cost reduction, with $15 million in performance bonuses at end of 2025.

• Home Health & Hospice has 49 preferred payers, with 81% of business on episodic contracts; Medical Solutions aims to grow preferred payers from 18 to 25.

Business segment performance and outlook

• PDS is the largest segment, accounting for 82% of revenue, with long-term growth projected at 3–5%, but currently experiencing higher growth due to pent-up demand.

• Home Health & Hospice, about 10% of revenue, grew 17.4% organically in Q1, outperforming industry averages.

• Medical Solutions, 8% of revenue, returned to growth with 7.4% organic increase in Q1 after modernization efforts.

• Overall organic growth guided at 6–8% annually, with M&A adding 1–2% for a total long-term growth target of 7–10%.

• EBITDA has grown from $129 million in late 2022 to approximately $340 million in the trailing four quarters.