The Ensign Group, Inc. ENSG recently purchased the operations of eight skilled nursing facilities in Tennessee and one such facility in Alabama. While it already boasts of a strong foothold in Tennessee, the latest move of acquiring operations of one Huntsville-based facility seems to mark ENSG’s entry in the state of Alabama. 

The eight skilled nursing facilities of Tennessee are named Meadowbrook Healthcare and Rehabilitation Center, Wellpark Health and Rehabilitation, Legacy Park Health and Rehabilitation, VanAyer Senior Living and Rehabilitation, Union City Health and Rehabilitation, Decatur County Healthcare, Savannah Nursing and Rehabilitation, Westwood Nursing and Rehabilitation. Located in different regions of the state, the healthcare units are equipped with 83, 30, 176, 91, 115, 125, 120 and 90 beds, respectively. Meanwhile, the Alabama facility, named The Health Center at Research Park, contains 91 beds. 

Six of these facilities are co-owned by CareTrust REIT, Inc. CTRE and a joint venture investor, and they have started operating under a new long-term triple-net master lease with ENSG-affiliated operating companies from the very beginning of 2025. The remaining three facilities were acquired by Ensign Group’s real estate subsidiary, 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. Post the latest buyouts, the company’s current portfolio comprises 333 healthcare operations across 15 states, 30 of which also feature senior living services. Through its subsidiaries, including Standard Bearer, Ensign Group owns 129 real estate assets, operating 96 of them.

Ensign Group’s Frequent Expansion Initiatives

While the latest move marks the first expansion initiative of Ensign Group for 2025, the year 2024 was quite an active year for it on this front. Such constant buyouts equip the company to delve deeper across several U.S. communities and offer relief to residents of areas grappling with inadequate care access. 

Management keeps an eye on detecting opportunistic real-estate buyouts. It also aims to lease struggling skilled nursing, senior living and other healthcare-linked businesses across the United States. 

An increase in the count of skilled nursing facilities enables the healthcare provider to cater to a larger patient base, potentially driving robust revenue growth within its Skilled Services segment. This segment generates income from various sources, including Medicaid, Medicare, managed care and private payors. Additionally, an aging U.S. population also provides the perfect ground for Ensign Group to capitalize on through its senior living operations. The Skilled Services unit usually contributes a significant chunk to ENSG’s overall revenues. Skilled services revenues rose 8.4% year over year in the first nine months of 2024. 

ENSG’s Share Price Performance & Zacks Rank

Shares of Ensign Group have gained 16.7% in the past year compared with the industry’s 9.3% 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 Doximity, Inc. DOCS and Inspire Medical Systems, Inc. INSP, each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Doximity’s earnings surpassed estimates in each of the last four quarters, the average surprise being 22.12%. The Zacks Consensus Estimate for DOCS’ 2025 earnings indicates a rise of 10% from the 2024 estimate. The consensus mark for revenues implies an improvement of 10.1% from the 2024 estimate. The consensus mark for DOCS’ 2025 earnings has moved 8.6% north in the past seven days.

The bottom line of Inspire Medical Systems outpaced estimates in each of the trailing four quarters, the average surprise being 649.90%. The Zacks Consensus Estimate for INSP’s 2025 earnings indicates a rise of 53.6% from the 2024 estimate. The consensus mark for revenues implies an improvement of 19% from the 2024 estimate. The consensus mark for INSP’s 2025 earnings has moved 50% north in the past 60 days.

Shares of Doximity and Inspire Medical Systems have gained 92.6% and 14.6%, respectively, in the past year.

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CareTrust REIT, Inc. (CTRE) : Free Stock Analysis Report

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