Business Strategy: Acadia Healthcare

Choose an organization to study. Provide an introduction to the organization, its products, and services. Discuss why you chose this organization to study, any area of the organization that is of particular interest to you. The organization chosen must be part of the student’s area of concentration.

Business Strategy: Acadia Healthcare

Acadia Healthcare is a publicly traded company headquartered in Franklin, Tennessee, USA. The company was established in 2005 to create and operate a group of behavioral healthcare facilities across the country. Acadia Healthcare provides a wide variety of services (including chemical dependency and psychiatric/mental services) to patients in different health settings, including specialized treatment facilities, inpatient psychiatric facilities, outpatient clinics, and residential treatment centers, among others (Acadia Healthcare, n.d). As of now, Acadia is the top provider of behavioral health services in the U.S. As of September 2021, the organization operated a group of two hundred and thirty behavioral health facilities with around 10,200 beds across the country

I chose this organization as it relates to my field of study, which is MBA in Medical Management. One aspect of the company that is of particular interest to me is Acadia’s philosophy and management style that upholds flexibility and collaboration. The company values input from staff members, physicians, nurses, and other key stakeholders. The mission of the organization is “to create a world-class organization that sets the standard of excellence in the treatment of specialty behavioral health and addiction disorders.”

Acadia Healthcare trades on the stock exchange. In the stock exchange, the company involves investors in buying and selling its shares. The company trades as NASDAQ, Russell 1000, and S&P 400. Nasdaq Composite is one of the stock market indices that are followed in the US. Acadia Healthcare Inc. is labeled as NSQ: ACHC in NASDAQ.

The company understands that investors are on the lookout for cheap but quality stocks and that is what is offered (Hobson, 2020). Stocks that are low cost but of good quality tend to be the popular market strategy for businesses. The trading share price of Acadia Healthcare is favorable for common investors because of its low cost valuation and high quality.

Good quality is preferred in the market because they represent dependable and solid businesses. It also shows the financial strength of the company apart from its profitability which means Acacia is a financially strong company. The quality of the stocks has been determined by metrics in the F-Score financial test. This score is a widely accepted accounting checklist that is used to determine stocks that improve financial health.

The market price of Acadia’s shares increases steadily over the months, however, investors have to be careful to choose stocks that are genuine bargains instead of falling for the value trap. Acadia factors in the weak nature of the economy thus the affordable prices. Forecasting the potential earnings can be difficult due to many factors and Earnings Yield can be used to determine the future state of the market.

Earnings Yield is used for comparison of the company’s market valuation and its profits. It provides the total value of the stock making it easier for investors to compare various types of stocks in the market. A reasonable Earnings Yield should be at least 5% and Acadia’s value is at 5.02% making it favorable for investors (Hobson, 2020).

References

Acadia Healthcare. (n.d). About Acadia . Retrieved from: https://www.acadiahealthcare.com/about/

Hobson, B. (2020). What factors will move the Acadia Healthcare Inc share price?. Stockopedia. Retrieved 14 January 2022, from https://www.stockopedia.com/articles/acadia-healthcare-inc-what-factors-will-move-the-acadia-healthcare-inc-share-price-112078%7d/.

Hobson, B. (2020). Why Acadia Healthcare Inc is a mid-cap stock for contrarian investors. Stockopedia. Retrieved 14 January 2022, from https://www.stockopedia.com/articles/acadia-healthcare-inc-why-acadia-healthcare-inc-is-a-mid-cap-stock-for-contrarian-investors-123458%7d/.

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