The Pennant Group (NASDAQ:PNTG) reported what management called an “exceptional year” in 2025, highlighting strong earnings growth, large-scale acquisitions, and improving operating metrics across its home health, hospice, and senior living businesses. Executives also provided 2026 guidance that anticipates another year of growth, while acknowledging integration-related “noise” from the company’s largest acquisition to date.
2025 results and full-year performance
CEO Brent Guerisoli said Pennant’s fourth-quarter adjusted earnings per share of $0.34 contributed to full-year 2025 adjusted EPS of $1.18, which exceeded the midpoint of the company’s updated annual guidance of $1.16.
Guerisoli attributed performance to a mix of acquisitions, same-store improvement, and leadership development, including adding more than 100 leaders to the company’s CEO-in-Training program and elevating 39 leaders to C-level roles within local operations. He reiterated Pennant’s five areas of focus: leadership development, clinical excellence, employee experience, margin improvement, and growth.
Acquisitions and integration priorities
Management emphasized that 2025 was marked by major expansion. On January 1, the company completed its acquisition of Signature Healthcare at Home in the Pacific Northwest, which Guerisoli said was “quickly integrated” into Pennant’s operating model with performance improving throughout the year.
In October, Pennant expanded into the Southeast with what Guerisoli described as the largest acquisition in its history: the purchase of more than 50 locations from UnitedHealth and Amedisys. President and COO John Gochnour said Pennant is transitioning those locations in waves and expects to complete all waves by October 2026. Management cautioned that a transition of this scale brings “initial choppiness” in early results and noted the process includes system and branding changes and a transition services agreement.
Executives said the company remains open to “selective and opportunistic” acquisitions, but plans to be more selective in the first half of 2026 on the home health and hospice side as it prioritizes integration. Gochnour added that senior living deal flow remains attractive, often structured as triple net leases with minimal capital outlay, and the company expects a steady pipeline throughout 2026.
Segment operating trends: home health, hospice, and senior living
Gochnour detailed a strong fourth quarter in the home health and hospice segment, with revenue of $233.3 million, up 64.3% year over year, and adjusted EBITDA of $33.7 million, up 58.2%.
- Home health: Fourth-quarter admissions increased 81.3%, and Medicare admissions rose 87.5% versus the prior-year quarter. Same-store Medicare admissions grew 8.2%, alongside a 3.7% increase in Medicare revenue per episode. Gochnour said Pennant’s average CMS star rating rose to 4.2, compared with a national average of 3.0. He also noted that under CMS’s Home Health Value-Based Purchasing Model, the vast majority of agencies owned in the 2023 measurement period received positive revenue adjustments in 2025.
- Hospice: Pennant’s CMS-reported hospice quality composite score was 97.5%, which Gochnour said helped drive average daily census to an all-time high of 5,060, up 46.9% year over year. Same-store hospice metrics also improved, including average daily census up 8.4%, admissions up 6.6%, and Medicare revenue per day up 5.9%.
In senior living, management said performance continued to improve, citing gains in occupancy, revenue, margins, and adjusted EBITDA. Full-year senior living segment revenue increased to $215 million, up 22.3%, while fourth-quarter revenue rose 19.6% to $56.1 million. Fourth-quarter senior living adjusted EBITDA was $6.1 million, up 46% year over year. All-store occupancy increased 200 basis points to 80.6%, and revenue per occupied room rose 5.6%. Same-store occupancy improved 250 basis points to 82.1%.
Gochnour also noted two senior living acquisitions completed in the fourth quarter: Twin Rivers Senior Living, a 55-bed assisted living community in Lewiston, Idaho (operations and real property acquired November 1), and the acquisition of real estate related to Honey Creek Heights Senior Living in West Allis, Wisconsin (acquired November 4) following an earlier operational acquisition on January 1, 2025.
Balance sheet, cash flow, and 2026 outlook
CFO Lynette Walbom said Pennant’s balance sheet “remains strong.” In the fourth quarter, the company expanded its credit facility with a $100 million term loan, bringing the total facility to $350 million. Pennant invested $147.2 million in the UnitedHealth acquisition in October. Walbom reported net debt to adjusted EBITDA of 1.7x, below the covenant limit of 3.25x.
Cash flow from operations was $21 million in the fourth quarter and $48.3 million year to date, with $17 million of cash on hand at year-end. For 2026, Walbom said the company expects operating cash flow of $45 million to $55 million and forecast capital expenditures of roughly $15 million.
For 2026, Pennant guided to:
- Revenue: $1.13 billion to $1.17 billion
- Adjusted EBITDA: $88.5 million to $94.1 million
- Adjusted EBITDA prior to NCI: $94.2 million to $100 million
- Adjusted EPS: $1.26 to $1.36
Guerisoli and Walbom both emphasized that guidance is annual rather than quarterly and reflects a ramp through the year, particularly as the company transitions a significant number of recently acquired operations in the first half of 2026.
During Q&A, Walbom described the guidance approach as conservative due to the expected “noise” from transitioning operations, including system changes and name changes and additional support provided by Pennant teams across the country. Management also said the model assumes about 7% same-store revenue growth in home health and hospice for 2026 and expects some margin expansion despite reimbursement headwinds. For senior living, Walbom said the company modeled about 100 basis points of occupancy improvement and rate increases similar to the prior year at about 6%, while general and administrative expenses were modeled at roughly 6.4% to 6.5% of revenue.
Strategy and competitive backdrop
Executives said Pennant views healthcare as a local business and believes its locally driven operating model is a differentiator, particularly as some scaled competitors have been acquired by payers. Guerisoli said the shifting competitive landscape provides an opportunity for Pennant to position itself as a “premier independent provider” and potentially strengthen payer negotiations based on clinical outcomes.
Management also discussed joint ventures embedded within acquired assets, including the University of Tennessee joint venture, saying Pennant treats JV operations like other businesses and prioritizes local leadership and collaboration with health system partners to improve clinical outcomes and transitions of care.
Looking ahead, management said the Southeast footprint—supported by a new Nashville service center—could become an area of strength, especially given consolidation in the region. The company reiterated that 2026 will be a year focused on integration and optimization, with leadership expressing confidence that the acquired operations can be “pretty well optimized” by the end of the year and into 2027.
About The Pennant Group (NASDAQ:PNTG)
The Pennant Group (NASDAQ: PNTG) is a publicly traded holding company that provides specialized services to the asset management industry. Through its operating subsidiaries, the company delivers outsourced fund administration, securities lending, prime brokerage, and capital markets solutions designed to support hedge funds, private equity firms, mutual funds and other institutional investors. By leveraging a combination of technology platforms and industry expertise, The Pennant Group helps clients streamline middle- and back-office processes, enhance operational efficiency and manage regulatory requirements.
Key service offerings include fund accounting and reporting, trade settlement and reconciliation, risk monitoring, securities lending programs and execution support across a range of asset classes.
