Aveanna Healthcare Bets on Internal Growth, Rejects Expensive Hospice Acquisitions

Aveanna Healthcare is steering away from costly deals in the hospice space and doubling down on internal expansion. CEO Jeff Shaner signaled on Friday that the company would not pursue pricey acquisitions, instead prioritizing organic growth. The question now is whether this prudent stance can sustain the revenue targets set for 2026.

• Strategy pivot: Emphasis on self-funded expansion rather than high-priced M&A.
• Valuation hurdle: Management views takeover multiples above 10x EBITDA as too steep.
• Revenue target: Guidance for 2026 tops out at 2.56 billion USD.

Discipline over deals
In the current market environment for hospice providers, Shaner believes valuations have run too hot. Transaction prices that exceed tenfold, or even fifteenfold, the company?s operating profit (EBITDA) do not fit Aveanna?s investment criteria. Instead, Aveanna is selectively pursuing opportunities at mid-to-high single-digit multiples.

This stance underlines a clear prioritization of organic growth. For 2026, the company plans to open two to three new sites using internal resources. In the longer run, the pace is expected to rise to two to four new locations annually. The company intends to strengthen its footprint in states like Ohio and West Virginia to better serve insurers that are increasingly targeting such partnerships.

Operational milestones backing the plan
The growth playbook is complemented by tangible operational progress. Recently, Aveanna?s Heartways program received certification from the Community Health Accreditation Partner (CHAP) for heart failure treatments. This endorsement confirms adherence to nationwide standards in both staff training and patient care.

Standardizing care for this high-risk patient group has a clear financial aim: by reducing hospitalizations, Aveanna should gain improved leverage when negotiating with payers, potentially leading to more favorable reimbursement terms over time.

Analysts? viewpoint
Market observers respond to the pivot with cautious optimism. Analysts from roughly a dozen financial houses peg the stock?s average target around 11.00 to 11.06 USD. With the shares trading near 7.98 USD, there appears to be meaningful upside if the insurer-partnership strategy yields results.

Nevertheless, observers continue to flag two major concerns: the company?s elevated debt level and ongoing pressures on reimbursement rates. For 2026, Aveanna projects revenue in a range of 2.54 to 2.56 billion USD?this forecast excludes any potential acquisitions. The focus remains on squeezing efficiency from current locations to hit the revenue goal without leaning on expensive buyouts.