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Acadia (ACHC) & SCL Health Form JV, Mark 15th Partnership

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Acadia Healthcare Company, Inc. (ACHC - Free Report) recently announced that it has formed a joint venture (JV) with a not-for-profit and faith-based healthcare organization SCL Health, based in Colorado. The JV is expected to build a 144-bed freestanding behavioral health unit in the Denver area.

The move is expected to boost Acadia Healthcare’s footprint in Colorado. The new hospital is likely to come online in mid-2023. With the rising demand for high-quality and accessible behavioral health services, Acadia Healthcare expects the JV to enhance all-inclusive inpatient and outpatient services and play a crucial role in boosting community outreach and improving patient experience. The deal is in line with the company’s strategy of boosting the acute service line.

The deal with SCL Health marks Acadia Healthcare’s 15th partnership, reflecting its focus on expanding capabilities in the United States. ACHC is actively pursuing JVs with renowned healthcare systems, which is helping the company expand its capabilities through bed additions. The healthcare provider has a robust pipeline of JV projects that are yet to be completed. This makes the company optimistic about the year 2022, which is likely to be its strongest year with respect to JVs, as four or five facilities are expected to commence operations.

On a similar move, earlier this month, it announced a partnership with Orlando Health, based in Florida. The deal was expected to boost Acadia Healthcare’s footprint in the southeastern United States. Last month, Acadia Healthcare entered into a JV with California’s renowned integrated healthcare system, Scripps Health, for operating an inpatient behavioral health hospital in the Eastlake community of Chula Vista. The hospital will house 120 beds and a speciality unit, which will cater to the behavioral health treatment of active-duty military and veterans.

With this Zacks Rank #3 (Hold) company’s huge network and comprehensive services, these JVs are expected to cater to the rising behavioral health needs in the communities. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other hospital companies like HCA Healthcare, Inc. (HCA - Free Report) , Tenet Healthcare Corporation (THC - Free Report) , and Universal Health Services, Inc. (UHS - Free Report) are also taking several measures to boost their presence and address the growing demand for high-quality health services.

Based in Nashville, TN, HCA Healthcare operates as one of the leading U.S. healthcare service providers, with a portfolio comprising 185 hospitals, five psychiatric hospitals and two rehabilitation hospitals at 2020-end. HCA is focused on acquisitions, which have bolstered its portfolio, led to network expansion and boosted patient volumes. Its bottom line for 2021 is expected to rise 63.7% year over year. It has witnessed nine upward estimate revisions in the past 60 days and one movement in the opposite direction. HCA beat earnings estimates in each of the last four quarters, with the average being 21.7%.

Headquartered in Dallas, TX, Tenet Healthcare is an investor-owned health care services company that owns and operates general hospitals as well as related health care facilities for urban and rural communities in numerous states. THC closed the buyout of a portfolio of 45 ambulatory surgical centers from SurgCenter Development for a value of $1.1 billion in December 2020. THC also entered into an agreement with Compass Surgical Partners to acquire the latter’s interest and management responsibilities in nine ASCs. THC is penetrating further in North Carolina. Its bottom line for 2021 is expected to rise 34.5% year over year.

King of Prussia, PA-based Universal Health Services owns and operates (through its subsidiaries) acute care hospitals, behavioral health centers, ambulatory surgery centers, surgical hospitals as well as radiation oncology centers. UHS instated 439 beds at its acute care and behavioral health hospitals. Also, over the years, acquisitions have played a key role in building UHS’ growth trajectory. In the past three years, Universal Health has spent more than $170 million on acquiring businesses and properties. This year, UHS acquired 88 beds through the acquisition of the Las Vegas specialty hospital and a LEED Medical Center micro-hospital. Its bottom line for 2021 is expected to rise 5.9% year over year.

Price Performances

Acadia Healthcare’s shares have increased 17.5% in the past year compared with the 35.7% rise of the industry.

Zacks Investment ResearchImage Source: Zacks Investment Research

During this time period, shares of HCA Healthcare and Tenet Healthcare have gained 51.7% and 88.2% each, while that of Universal Health Services has lost 7%.