Value
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 8.9 |
| P/S | 9.6 |
| EV/EBITDA | 3.6 |
| Fwd P/E | 8.1 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 14.6x
- ▸PEG: 0.02
- ▸Attractively valued
AVAH · Why this verdict
Why Aveanna Healthcare Holdings (AVAH) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score6.4/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Aveanna Healthcare has beaten earnings four quarters in a row and trades at a forward P/E of 14.5x with 199% ROE, but price is already at the analyst target, insiders have sold an extreme 19.4% of market cap and payer concentration is high.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Aveanna has beaten EPS estimates in all 4 of the last 4 quarters, with an average surprise of 24.3%. Earnings track record | EPS continues to beat at the 2026-11-12 report. | ↑Improving |
| CounterBeats come off very small per-share estimates (0.13 to 0.17), so small dollar gaps produce large percentage surprises that may not reflect real earnings power. | ||
Price of $13.16 is 0.5% above the $13.09 analyst target, so upside to the target is gone and reward-to-risk is slightly negative. Upside pct | Analyst targets are raised after the next earnings report or the stock pulls back. | ↓Deteriorating |
| CounterLight analyst coverage (10 analysts) means targets can move up quickly after continued beats. | ||
Insiders have sold $558,509,932, or 19.442% of market cap, an extreme level of selling. Insider breakdown | Insider selling slows below 2% of market cap over the next 12 months. | →Stable |
| CounterLarge sales may be sponsor-owner share distributions rather than a signal about the business, and institutions are accumulating shares. | ||
Revenue depends on government and private payers, with Medicare, Medicaid and private health insurance concentration flagged as a HIGH risk. Bear case | Reimbursement rates remain stable and payer mix does not worsen over 12 months. | ↓Deteriorating |
| CounterA reimbursement cut by state Medicaid programs would hit revenue directly with little ability to pass costs on. | ||
Returns are very high with 199% ROE and attractive valuation (PEG 0.02), but free cash flow is only 38% of net income, a flagged earnings-quality weakness. Quality breakdown | Free cash flow rises above 70% of net income as leverage declines. | →Stable |
| CounterA 199% ROE reflects a thin equity base after past losses, so it overstates underlying returns. | ||
Aveanna has beaten EPS estimates in all 4 of the last 4 quarters, with an average surprise of 24.3%.
↑ImprovingEarnings track record
- Expectation
- EPS continues to beat at the 2026-11-12 report.
CounterBeats come off very small per-share estimates (0.13 to 0.17), so small dollar gaps produce large percentage surprises that may not reflect real earnings power.
Price of $13.16 is 0.5% above the $13.09 analyst target, so upside to the target is gone and reward-to-risk is slightly negative.
↓DeterioratingUpside pct
- Expectation
- Analyst targets are raised after the next earnings report or the stock pulls back.
CounterLight analyst coverage (10 analysts) means targets can move up quickly after continued beats.
Insiders have sold $558,509,932, or 19.442% of market cap, an extreme level of selling.
→StableInsider breakdown
- Expectation
- Insider selling slows below 2% of market cap over the next 12 months.
CounterLarge sales may be sponsor-owner share distributions rather than a signal about the business, and institutions are accumulating shares.
Revenue depends on government and private payers, with Medicare, Medicaid and private health insurance concentration flagged as a HIGH risk.
↓DeterioratingBear case
- Expectation
- Reimbursement rates remain stable and payer mix does not worsen over 12 months.
CounterA reimbursement cut by state Medicaid programs would hit revenue directly with little ability to pass costs on.
Returns are very high with 199% ROE and attractive valuation (PEG 0.02), but free cash flow is only 38% of net income, a flagged earnings-quality weakness.
→StableQuality breakdown
- Expectation
- Free cash flow rises above 70% of net income as leverage declines.
CounterA 199% ROE reflects a thin equity base after past losses, so it overstates underlying returns.
Per-dimension breakdown
Quality
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 6.5 |
| Gross margin | 2.4 |
| Op margin | 5.0 |
| Net margin | 5.3 |
| Current ratio | 4.5 |
| FCF quality | 3.0 |
| Moat | 6.0 |
| Piotroski F | 6.7 |
- ▸Excellent ROE: 199%
- ▸Earnings quality RED FLAG: 38% FCF/NI
Growth
7.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.9 |
| EPS growth | 9.7 |
Momentum
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 8.8 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 9.1 |
- ▸Overbought (RSI 71)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.0 |
| Price target | 5.9 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (10.0) — signal dampened
Insider
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Heavy insider selling — $558,509,932 (19.266% of mkt cap)
- ▸Institutions accumulating
Peer rank
5.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.5 |
| quality rank | 9.1 |
| growth rank | 7.4 |
- ▸Superior ROE vs peers
- ▸Best-in-class margins
Technical
3.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.7 |
| 52w position | 9.3 |
| gap | 5.0 |
Risk (lower is worse)
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.0 |
| days to cover | 9.2 |
| volatility | 4.2 |
| put call | 10.0 |
| implied vol | 0.0 |
| beta | 3.3 |
| debt equity | 0.0 |
- ▸High IV: 108%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Strong earnings: 3B/0M
- ▸Earnings in 7 days
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- MOMENTUM:8.3>=5.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- ASYMMETRY:-0.5=NEGATIVE
- INSIDER:19.27%=EXTREME
- EARNINGS_PROXIMITY:7d<=7d
Warning (0)
none
Reward-to-Risk
-0.53
Upside
-8.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 2.01>1.3, MCap $2.9B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Momentum at 8.3) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.5=NEGATIVE, INSIDER:19.27%=EXTREME, EARNINGS_PROXIMITY:7d<=7d) reinforce the read. Current asymmetry R:R is -0.53 — supplementary context, not the trigger for this path.
The strongest dimensions are Momentum at 8.3, Growth at 7.8, and Catalyst at 7.5; the weakest are Technical at 3.8, Risk (lower is worse) at 4.8, and Insider at 5.2. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of -0.53 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Earnings Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P2Target Already Reached
Trip ifPrice exceeds the analyst target by more than 10% from the current 0.5%.
- P3Extreme Insider Selling
Trip ifInsider selling exceeds 25% of market cap from the current 19.442%.
- P4Payer Concentration Risk
Trip ifMedicaid and Medicare payer share exceeds 80% of revenue.
- P5High Roe Weak Cash Conversion
Trip ifFree cash flow to net income falls below 20% from the current 38%.