PACS Beats the Street on 3Q Earnings, Occupancy Tops 91%

PACS Group, Inc. (NYSE: PACS) announced operating results for the third quarter of 2026 that beat Wall Street estimates with adjusted earnings per share of $0.63, an increase of 37 percent over the prior year and revenue of $1.50 billion, 11.5 percent higher than 3Q 2025.

Analysts expected 3Q earnings of $0.5790 per share on $1.46 billion in revenue.

The company said net income was $60.8 million, an increase of $8.5 million, or 16.2 percent from $52.3 million in the prior-year period. Adjusted EBITDA was $175.7 million, an increase of $44.2 million, or 33.6 percent from $131.5 million in the prior-year period. Adjusted EBITDAR was $273.9 million.

Occupancy Grows

On a same-store basis, which includes the 284 SNFs operated by PACS as of the beginning of 2025, SNF revenue increased 6.4 percent in the third quarter of 2026 compared to the prior-year period. Occupancy improved to 91.3 percent from 89.3 percent in the third quarter of 2025, and skilled mix increased in both revenue and nursing patient days.

The company had 250 facilities, or 78.9 percent, of its skilled nursing portfolio achieve a 4- or 5-Star CMS Quality Measure Star rating, with its 196 mature facilities achieving an average rating of 4.5 as of Sept. 30.

Overall occupancy was 90.2 percent, compared to an industry average of 80.2 percent. Mature facilities occupancy was 93.1 percent.

Mature facilities skilled mix was 31.3 percent, while overall skilled mix increased to 29.1 percent, an improvement of 90 basis points from 28.2 percent in the prior-year period, driven by continued improvement in its Ramping facilities cohort.

As of Sept. 30, PACS had $707.4 million in available liquidity, including $115.3 million of cash and cash equivalents.

CEO Talk

“Our third quarter results reflect the continued progress our teams are making across the organization, both in the quality of care we provide and the performance of our facilities,” said Jason Murray, PACS CEO. “Same-store revenue increased 6.4 percent, occupancy improved to 91.3 percent, and skilled mix continued to strengthen. Importantly, 78.9 percent of our skilled nursing facilities achieved four- or five-Star CMS Quality Measure ratings, reflecting the dedication of our local teams and their commitment to delivering exceptional patient care.”

He added that with its recent expansion into Florida and continued growth in Texas, the company has significantly broadened its geographic reach.

“As we continue to grow, our focus remains on empowering local leaders, improving clinical outcomes, and building strong operations that create lasting value for our patients, employees, and shareholders,” Murray said.

Adjustments Go Higher

PACS increased its full-year 2026 Adjusted EBITDA guidance to a range of $685 million to $695 million, up from a prior range of $640 million to $660 million. At the midpoint, this represents approximately 37 percent growth over 2025.

PACS is also increasing its revenue guidance to $5.95 billion to $6.05 billion, up from $5.75 billion to $5.85 billion.

“Our guidance reflects approximately $5 million of EBITDA contribution from retroactive quality incentive payments in Ohio received in the month of October. We also continue to see a robust pipeline of acquisition opportunities and remain actively engaged in evaluating transactions that meet our strategic, operational and financial criteria,” said PACS CFO Carey Hendrickson.

As of today, PACS's portfolio comprises 398 healthcare operations across 21 states. PACS owns 66 facilities and leases an additional 49 facilities with partial ownership in real estate. PACS holds 37 purchase options on leased facilities and 20 purchase options through partnerships.

PACS will hold an analyst call on the 3Q results on Nov. 4.

Comments or questions? Contact Patrick Connole at pconnole@parkplacelive.com.