PACS - Quick Take - Starting The Year On A High Note, FY26 Adj. EBITDA Guidance Raised & Repurchase Auth Announced

Research evidence excerpt

PACS - Quick Take - Starting The Year On A High Note, FY26 Adj. EBITDA Guidance Raised & Repurchase Auth Announced

ctively, while mature facilities

declined (70bp) likely reflective of 33 additional facilities in the cohort. Total skilled mix

increased +70bp as a percentage of revenue to 50.7% as ramping facilities improved +270bp

4 Page Document to 46.7% while mature facilities were down (140bp) to 55.5% and new facilities were also

lower (down 120bp to 38.7%) and as a percentage of days skilled mix improved +360bp and

+100bp within ramping and new facilities while mature facilities were (110bp). Finally, on

Reasons for this report the quality front, PACS ended the quarter with 78.4% of facilities with a 4 or 5 CMS Quality

Measure Star rating, a nice sequential improvement (vs. 73.4% at the end of 2025) while

✓ First Look Post Earnings PACS’ mature facilities remain above industry averages in both average Star rating (4.4 vs.

3.6 industry average) and occupancy (95% vs. 79% industry average).

Expansion Activity Ongoing. We are bullish on continued expansion activity at PACS as

the company acquired the operations of three senior living facilities in the quarter within

existing states. Additionally, PACS acquired the underlying real estate for two of the three

facilities and the real estate of another facility in AZ for $86.5M. Subsequent to quarter-end,

the company acquired the operations of a facility in AK and land adjacent to the facility,

planning to build a 150-bed skilled nursing facility with an estimated completion date of 2028.

Finally, PACS continues to see a robust pipeline of opportunities within its target criteria and

is involved in potential transactions.

Financial Flexibility Remains Superb, Cash Flow Ahead And Share Repurchase

Authorization Announced.