Aveanna Healthcare (AVAH) Deutsche Bank 2026 Healthcare Summit summary

Strategic transformation and growth drivers

• Achieved a 1,700% equity increase since late 2022, driven by a shift to preferred payer networks and operational restructuring.

• Preferred payer strategy now in its fourth year, with 64% of Private Duty Services (PDS) volumes under preferred contracts, up from 57% at year-end.

• Home Health and Hospice segment boasts 81% of business under episodic contracts, growing 15.5% organically year-over-year.

• Medical Solutions modernization completed in 2025, with preferred payer strategy in early stages and 20 payers identified.

• Expansion into new Medicaid states is a priority, targeting seven additional states for further diversification and growth.

Financial performance and operational efficiency

• Consistently beat and raised guidance for 14 consecutive quarters, with average beats of 40%-50%.

• Updated long-range plans (LRP) reflect higher growth rates: PDS at 5%-6%, Home Health and Hospice at 10%, Medical Solutions at 8%-10%.

• SG&A leverage improved by 100-140 basis points annually, aided by automation and AI in back-office and revenue cycle management.

• Accounts receivable reserves at historic lows due to improved payer relationships and automation.

• Deleveraged balance sheet to around 4x, with a goal to reach sub-3x by mid-to-late 2027, supporting both organic and inorganic growth.

California rate increase and market impact

• Secured a 40% PDN rate increase in California after five years of advocacy, reversing years of decline in the state.

• Plan to invest in wage pass-throughs in Q4 2026 to ramp up caregiver recruitment and fill rates, aiming to restore fill rates from sub-50% to 80%-85% over 12-24 months.

• Estimated 1,000-1,400 children in California remain in hospitals or at home without adequate nursing, representing a multi-year growth opportunity.

• California growth expected to unfold over two to three years, with significant impact in 2027 and beyond.