Ensign Group (ENSG) Buys Nursing Units, Boosts U.S. Footprint

The Ensign Group, Inc. ENSG recently purchased the operations of two skilled nursing facilities in Colorado and one such healthcare facility in Kansas. The three buyouts were effective since Mar 1, 2024, and the acquisitions in Colorado were subject to a long-term, triple-net master lease.

The two skilled nursing facilities in Colorado are situated in Parker and Lakewood and are named Park Post Acute, and Oakwood Care and Rehabilitation. The facilities are equipped with 135 and 170 beds, respectively. Meanwhile, the healthcare facility purchased in Kansas is named Atchison Senior Village Rehabilitation and Nursing Center, and contains 45 beds.  

The real estate operations of the Kansas-based facility were bought by the captive real estate company of Ensign Group, Standard Bearer Healthcare REIT.

By working closely with a team of caregivers at the acquired facilities, ENSG will be able to gain an in-depth understanding of the local communities, thereby rendering high-quality care to residents and their families.

The recent move bears testament to Ensign Group’s endeavor to further solidify its extensive presence across Colorado and Kansas. It also serves as a means to bolster the healthcare operations of ENSG and the real estate portfolio of its Standard Bearer subsidiary. Post the latest buyouts, the company’s current portfolio comprises 302 healthcare operations situated across 14 states. ENSG’s subsidiaries also own 114 real estate assets.

An increase in the count of skilled nursing facilities allows the healthcare provider to serve a higher number of patients, which, in turn, may simultaneously result in improved revenue growth from the Skilled Services segment. Revenues from the unit are derived from Medicaid, Medicare, managed care and private payors. An aging U.S. population also provides the perfect ground for Ensign Group to capitalize through its senior living operations, which presently stand at 27.

The Skilled Services unit usually contributes a significant chunk to ENSG’s overall revenues. Skilled services revenues rose 23.1% year over year in 2023.

Ensign Group pursues an impressive inorganic growth strategy and a solid financial position serves as a cushion for it to pursue investments related to its growth efforts. Management keeps an eye on detecting opportunistic real-estate buyouts. It also aims to lease solid and struggling skilled nursing, assisted living and other healthcare-linked businesses across the United States.

ENSG started the year 2024 by purchasing the operations of a skilled nursing facility in Tennessee and another one in Nevada. Such constant buyouts equip Ensign Group to delve deeper across several U.S. communities and offer relief to residents of areas grappling with inadequate care access.  

Shares of Ensign Group have gained 39.6% in the past year compared with the industry’s 38.6% growth. ENSG currently carries a Zacks Rank #2 (Buy).

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Other Stocks to Consider

Some other top-ranked stocks in the Medical space are LeMaitre Vascular, Inc. LMAT, Medpace Holdings, Inc. MEDP and HCA Healthcare, Inc. HCA, each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

LeMaitre Vascular’s earnings surpassed estimates in each of the last four quarters, the average beat being 8.91%. The Zacks Consensus Estimate for LMAT’s 2024 earnings indicates a rise of 21.5% from the year-ago reported figure. The consensus mark for revenues suggests an improvement of 9.4% from the year-ago reported figure. The consensus mark for LMAT’s 2024 earnings has moved 8.6% north in the past seven days.

The bottom line of Medpace outpaced estimates in each of the trailing four quarters, the average surprise being 12.42%. The Zacks Consensus Estimate for MEDP’s 2024 earnings indicates a rise of 19.1% from the year-ago reported figure. The consensus mark for revenues suggests an improvement of 15.9% from the year-ago reported figure. The consensus mark for MEDP’s 2024 earnings has moved 5.3% north in the past 30 days.

HCA Healthcare’s earnings beat estimates in three of the trailing four quarters and missed the mark once, the average surprise being 9.78%. The Zacks Consensus Estimate for HCA’s 2024 earnings indicates a rise of 7.8% from the year-ago reported figure. The consensus mark for revenues suggests an improvement of 6.2% from the year-ago reported figure. The consensus mark for HCA’s 2024 earnings has moved 1.3% north in the past 30 days.

Shares of LeMaitre Vascular, Medpace and HCA Healthcare have gained 34.8%, 99.4% and 25%, respectively, in the past year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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