Shares of Acadia Healthcare Company Inc. (ACHC -0.06%), a leading provider of psychiatric and chemical dependency services, fell as much as 13% on Monday. Shares were down about 9% as of 3:21 p.m. EST. The drop can be traced to the publication of a research report by a group of analysts.
News broke today that analysts at Cantor Fitzgerald recently reaffirmed their "hold" rating on Acadia's stock. The analysts also released a near-term price target of $39.00.
In the report, analysts stated that they rated Acadia as neutral because of the "uncertainty associated with the recovery of its U.K. business." The company's U.K. business accounts for about 40% of sales, so the analysts felt it was prudent to be more cautious on the stock.
Canto's price target of $39 represents a double-digit-percentage decline from Friday's closing price of $44.75. Shares are taking a step back today in response to the mildly bearish report.
The last few years haven't been kind to Acadia's shareholders. The stock is now down about 50% from its all-time high that was reached in 2015, so it's been a trying time for investors.
After today's bashing, the stock now trades for less than 15 times next year's earnings estimates. With current estimates calling for double-digit profit growth over the next five years, it's possible that Acadia might be a value stock that is worth considering.