Pennant Group, Inc.
For the period ended Dec 31, 2025. Filed Feb 26, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 26, 2026
PNTG$36.36-9.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-27.
0001766400-25-000024
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-26.
0001766400-26-000014
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 124 previous paragraphs and 122 current paragraphs.
94 unchanged; 21 reworded; 7 added; 9 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 24 previous and 24 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
Expansion into New States. In the fourth quarter of 2025, we expanded our home health, hospice, and home care operations into the southeastern United States. This expansion was our largest acquisition to date and included 30 home health, hospice, and home care agencies in Alabama, Georgia, and Tennessee. This expansion is part of our strategy to grow our national presence in the post-acute care continuum across both our existing markets and new markets.
Current report
We have experienced improvement in senior living revenue per occupied unit and occupancy through the year ended December 31, 2025, compared to the same period in 2024. Though we have seen improvements in revenue per occupied unit and occupancy year over year, the highly competitive environment for senior living residents and inflationary factors will continue to impact the rate at which our revenue per occupied unit and occupancy levels change in our senior living communities.
Current report
•results at start-up operations;
Current report
•acquisition related costs;
Current report
•unusual, non-recurring, or redundant charges.
Current report
Credit Agreement
Current report
On November 3, 2025, Pennant entered into the First Amendment to Amended and Restated Credit Agreement (the “First Amendment”), pursuant to which, Pennant obtained an incremental term loan facility in an aggregate principal amount of $100 million (the “Incremental Term Loans”). The Incremental Term Loans constitute term loans under, and are subject to the terms and provisions of, the Amended Credit Agreement, including bearing interest at the same interest rate, and having the same maturity date, as the Amended Revolving Credit Facility. In conjunction with the First Amendment, the Company incurred additional debt issuance costs of $1,203. The Company used the proceeds of the Incremental Term Loans to refinance a portion of the outstanding revolving loans under the Amended Revolving Credit Facility and to pay fees and expenses incurred in connection with the First Amendment.
Removed paragraphs (9)
Previous report
We have experienced stable senior living occupancy through the year ended December 31, 2024. Although we saw steady improvements in occupancy throughout 2023 as a result of renewed consideration of senior living communities as the negative impacts of the global pandemic subsided, and stable occupancy during 2024, the highly competitive environment for senior living residents and inflationary factors will continue to impact our occupancy levels in our senior living communities.
Previous report
•Routine Home Care (RHC). Care that is not classified under any of the other levels of care, such as the work of nurses, social workers or home health aides.
Previous report
•General Inpatient Care. Pain control or acute or chronic symptom management that cannot be managed in a setting other than an inpatient Medicare-certified facility, such as a hospital, skilled nursing facility or hospice inpatient facility.
Previous report
•Continuous Home Care. Care for patients experiencing a medical crisis that requires nursing services to achieve palliation and symptom control, if the agency provides a minimum of eight hours of care within a 24-hour period.
Previous report
•Inpatient Respite Care. Short-term, inpatient care to give temporary relief to the caregiver who regularly provides care to the patient.
Previous report
•costs at start-up operations;
Previous report
•acquisition related costs and credit allowances;
Previous report
•unusual or non-recurring charges.
Previous report
Revolving Credit Facility
Reworded paragraphs (21)
Previous wording
We are a leading provider of high-quality healthcare services to patients and residents of all ages, including the growing senior population, in the United States. We strive to be the provider of choice in the communities we serve through our innovative operating model. We operate in multiple lines of businesses including home health, hospice and senior living services across Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming. We also provide home health and hospice operational support through a management service agreement in Connecticut. As of December 31, 2024, our home health and hospice business provided home health, hospice and home care services from 123 agencies operating across 13 states, and our senior living business operated 57 senior living communities throughout seven states.
Current wording
We are a leading provider of high-quality healthcare services to patients and residents of all ages, including the growing senior population, in the United States. We strive to be the provider of choice in the communities we serve through our innovative operating model. We operate in multiple lines of businesses including home health, hospice and senior living services across Alabama, Arizona, California, Colorado, Georgia, Idaho, Montana, Nevada, Oklahoma, Oregon, Tennessee, Texas, Utah, Washington, Wisconsin and Wyoming. We also provide home health and hospice operational support through a management service agreement in Connecticut. As of December 31, 2025, our home health and hospice business provided home health, hospice and home care services from 172 agencies operating across 16 states, and our senior living business operated 63 senior living communities throughout seven states.
Previous wording
Acquisitions. During 2024, we expanded our operations with the addition of eight home health agencies, three hospice agencies, and six senior living communities. A subsidiary of the Company entered into a separate purchase agreements with the prior operator of each acquired operation as part of each transaction.
Current wording
Acquisitions. During 2025, we expanded our operations with the addition of 30 home health agencies, nine hospice agencies, four home care agencies, and six senior living communities. A subsidiary of the Company entered into a separate purchase agreements with the prior operator of each acquired operation as part of each transaction.
Previous wording
We have two reportable segments: (1) home health and hospice services, which includes our home health, hospice, home care, and geriatric primary and palliative care businesses; and (2) senior living services, which includes our assisted living, independent living and memory care services. Our Chief Executive Officer, who is our Chief Operating Decision Maker (“CODM”), reviews financial information at the operating segment level using segment adjusted EBITDAR from operations. We also report an “all other” category that includes general and administrative expense from our Service Center.
Current wording
We have two reportable segments: (1) home health and hospice services, which includes our home health, hospice, home care, and geriatric primary and palliative care businesses; and (2) senior living services, which includes our assisted living, independent living and memory care services. Our Chief Executive Officer, who is our Chief Operating Decision Maker (“CODM”), reviews financial information at the operating segment level using segment adjusted EBITDAR from operations.
Previous wording
Hospice. We derive the majority of our hospice business revenue from Medicare reimbursement. The estimated payment rates are calculated as daily rates for each of the levels of care we deliver. Rates are set based on specific levels of care, are adjusted by a wage index to reflect healthcare labor costs across the country and are established annually through federal legislation. The following are the four levels of care provided under the hospice benefit:
Current wording
Hospice. We derive the majority of our hospice business revenue from Medicare reimbursement. The estimated payment rates are calculated as daily rates for each of the levels of care we deliver. Rates are set based on specific levels of care, are adjusted by a wage index to reflect healthcare labor costs across the country and are established annually through federal legislation.
Previous wording
•Self-insurance reserves - The Company is self-insured for general and professional liability, workers’ compensation, automobile, and its employee health plans while maintaining stop-loss coverage with third-party insurers to limit its total liability exposure. The valuation methods and assumptions used in estimating costs up to retention amounts to settle open claims of insureds and an estimate of the cost of insured claims up to retention amounts that have been incurred but not reported;
Current wording
•Self-insurance reserves - The Company is self-insured for general and professional liability, workers’ compensation, automobile, and its employee health plans while maintaining stop-loss coverage with third-party insurers to limit its total liability exposure. The Company accrues amounts equal to the actuarial estimated costs to settle open claims of insureds, as well as an estimate of the costs of insured claims that have been incurred but not reported. We develop information about the size of the ultimate claims based on historical experience, current industry information, and actuarial analysis;
Previous wording
•costs associated with transitioning operations; and
Current wording
•activities associated with transitioning operations; and
Previous wording
Our consolidated revenue increased $150.3 million, or 27.6%, driven by the net organic growth of existing operations across all segments of $59.2 million or 10.9% as well as increased revenue from acquired operations of $91.1 million, or 16.7%, during the year ended December 31, 2024.
Current wording
Our consolidated revenue increased $252.5 million, or 36.3%, driven by the net organic growth of existing operations across all segments of $67.5 million or 9.7% as well as increased revenue from acquired operations of $185.0 million, or 26.6%, during the year ended December 31, 2025.
Previous wording
Home health and hospice revenue increased $125.0 million, or 31.7%. Revenue grew due to an increase in almost all key performance indicators including an increase in total home health admissions of 37.3%, an increase in Medicare home health admissions of 26.9%, an increase in average Medicare revenue per 60-day completed episode of 6.0%, an increase of 25.3% in total hospice admissions, and an increase of 25.4% in hospice average daily census, while Hospice Medicare revenue per day decreased by 1.1%. The improvement in these metrics resulted in net organic revenue growth of $46.4 million for the year ended December 31, 2024. Growth was also driven by the acquisition of eleven home health and hospice operations during the year ended December 31, 2024, and the acquisition of thirteen home health, home care, and hospice operations during the year ended December 31, 2023, resulting in an increase in revenue of $78.6 million, or 19.9% overall.
Current wording
Home health and hospice revenue increased $213.2 million, or 41.0%. Revenue grew due to an increase in all key performance indicators including an increase in total home health admissions of 44.1%, an increase in Medicare home health admissions of 41.8%, an increase in average Medicare revenue per 60-day completed episode of 3.5%, an increase of 24.4% in total hospice admissions, and an increase of 28.6% in hospice average daily census, and an increase in Hospice Medicare revenue per day of 4.9%. The improvement in these metrics resulted in net organic revenue growth of $52.8 million for the year ended December 31, 2025. Growth was also driven by the acquisition of forty-three home health, home care and hospice operations during the year ended December 31, 2025, and the acquisition of eleven home health, home care, and hospice operations during the year ended December 31, 2024, resulting in an increase in revenue of $160.5 million, or 30.9% overall.
Previous wording
Senior living revenue increased $25.3 million, or 16.8%, for the year ended December 31, 2024 when compared to the same period in the prior year primarily due to a 8.3% increase in average monthly revenue per occupied unit and a 0.3% increase in occupancy rate. Growth in revenue was also driven by the acquisition of six senior living communities during the year ended December 31, 2024, and the acquisition of two senior living communities during the year ended December 31, 2023, resulting in an increase of $12.5 million, or 8.3% overall.
Current wording
Senior living revenue increased $39.2 million, or 22.3%, for the year ended December 31, 2025 when compared to the same period in the prior year primarily due to an 8.0% increase in average monthly revenue per occupied unit and a 90 basis point increase in occupancy rate. Growth in revenue was also driven by the acquisition of six senior living communities during the year ended December 31, 2025, and the acquisition of six senior living communities during the year ended December 31, 2024, resulting in an increase of $24.6 million, or 14.0% overall.
Previous wording
Consolidated cost of services increased $120.4 million, or 27.5%, for the year ended December 31, 2024 when compared to the year ended December 31, 2023. The increase in the amount of cost of services was driven primarily by volume of services provided and increased wages and benefits. Cost of services as a percentage of revenue decreased by 10 basis points from 80.4% to 80.3% over the same time period.
Current wording
Consolidated cost of services increased $210.1 million, or 37.6%, for the year ended December 31, 2025 when compared to the year ended December 31, 2024. The increase in the amount of cost of services was driven primarily by volume of services provided and increased wages and benefits. Cost of services as a percentage of revenue increased by 80 basis points from 80.3% to 81.1% over the same time period.
Previous wording
Cost of services related to our Home Health and Hospice services segment increased $101.6 million, or 30.6%, primarily due to increased volume of services from the growth in admissions and average daily census as well as increased wages and benefits. Cost of services as a percentage of revenue for the year ended December 31, 2024 decreased by 70 basis points compared to the year ended December 31, 2023 primarily due to increased efficiency in our operations.
Current wording
Cost of services related to our Home Health and Hospice services segment increased $179.0 million, or 41.3%, primarily due to increased volume of services from the growth in admissions and average daily census as well as increased wages and benefits. Cost of services as a percentage of revenue for the year ended December 31, 2025 increased by 20 basis points compared to the year ended December 31, 2024 primarily due to increased wages and benefits.
Previous wording
Cost of services related to our Senior Living services segment increased $18.7 million, or 17.6%, during the year ended December 31, 2024 in response to higher occupancy, acquisitions and wage rate increases. As a percentage of revenue, costs of service increased by 50 basis points during the year ended December 31, 2024 when compared to the year ended December 31, 2023 primarily due to increased wages and benefits.
Current wording
Cost of services related to our Senior Living services segment increased $31.1 million, or 24.9%, during the year ended December 31, 2025 in response to higher occupancy, acquisitions and wage rate increases. As a percentage of revenue, costs of service increased by 150 basis points during the year ended December 31, 2025 when compared to the year ended December 31, 2024 primarily due to increased wages and benefits.
Previous wording
Rent—Cost of Services. Rent increased 8.2% from $39.8 million to $43.0 million for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily as a result of the newly acquired senior living communities. As a percentage of revenue, rent—cost of services decreased 110 basis points when compared to the year ended December 31, 2023 due to improved overall sales leverage and performance.
Current wording
Rent—Cost of Services. Rent increased 13.2% from $43.0 million to $48.7 million for the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily as a result of the newly acquired senior living communities. As a percentage of revenue, rent—cost of services decreased 110 basis points when compared to the year ended December 31, 2024 due to improved overall sales leverage and performance.
Previous wording
General and Administrative Expense. General and administrative expense increased $13.5 million, or 36.9%, from $36.7 million to $50.2 million for the year ended December 31, 2024 when compared to the year ended December 31, 2023. The increase in general and administrative expense was primarily due to an increase of $12.5 million in wages and benefits for the year ended December 31, 2024 when compared to the year ended December 31, 2023.
Current wording
General and Administrative Expense. General and administrative expense increased $20.9 million, or 41.6%, from $50.2 million to $71.1 million for the year ended December 31, 2025 when compared to the year ended December 31, 2024. The increase in general and administrative expense was primarily due to an increase of $18.8 million in wages and benefits for the year ended December 31, 2025 when compared to the year ended December 31, 2024.
Previous wording
(Gain) loss on Asset Dispositions and Impairment, Net.(Gain) loss on asset dispositions and impairment, net is a gain of $0.7 million for the year ended December 31, 2024 compared to a loss of $0.1 million for the year ended December 31, 2023 primarily due to insurance proceeds related to one of our senior living communities.
Current wording
Gain on Asset Dispositions and Impairment, Net. Gain on asset dispositions and impairment, net was $1.0 million for the year ended December 31, 2025 compared to $0.7 million for the year ended December 31, 2024 primarily due to insurance proceeds related to one of our senior living communities.
Previous wording
Provision for Income Taxes. Our effective tax rate for the year ended December 31, 2024 was 22.4% of earnings before income taxes compared with an effective tax rate of 29.0% for the year ended December 31, 2023. The decrease in the effective tax rate is primarily due to a change in deductible equity compensation expenses. See Note 14, Income Taxes, to the Consolidated Financial Statements included elsewhere in this report filed on Form 10-K for further discussion.
Current wording
Provision for Income Taxes. Our effective tax rate for the year ended December 31, 2025 was 26.0% of earnings before income taxes compared with an effective tax rate of 22.4% for the year ended December 31, 2024. The increase in the effective tax rate is primarily driven by the change in discrete tax effects of share-based compensation. See Note 14, Income Taxes, to the Consolidated Financial Statements included elsewhere in this report filed on Form 10-K for further discussion.
Previous wording
Our primary sources of liquidity are cash generated through operating activities and borrowings under our revolving credit facility.
Current wording
Our primary sources of liquidity are cash generated through operating activities and borrowings under our credit agreement.
Previous wording
As of December 31, 2024 we had $24.2 million of cash and $245.8 million of available borrowing capacity on our Amended Revolving Credit Facility.
Current wording
As of December 31, 2025 we had $17.0 million of cash and $171.6 million of available borrowing capacity on our Amended Revolving Credit Facility.
Previous wording
Our net cash flow from operating activities for the year ended December 31, 2024 increased by $6.2 million when compared to the year ended December 31, 2023. The primary drivers of this difference was a $10.4 million increase in net income, offset by a $2.5 million net decrease in cash flows from the change in operating assets and liabilities and a net decrease of $1.7 million in non-cash expenses.
Current wording
Our net cash flow from operating activities for the year ended December 31, 2025 increased by $9.0 million when compared to the year ended December 31, 2024. The primary drivers of this difference were a $9.4 million increase in net income and a $2.5 million net decrease in cash flows from the change in operating assets and liabilities.
Previous wording
Our net cash used in investing activities for the year ended December 31, 2024 increased by $40.5 million compared to the year ended December 31, 2023, primarily driven by a $40.4 million increase in business acquisitions, asset acquisitions, and escrow deposits during the year ended December 31, 2024 compared to the year ended December 31, 2023.
Current wording
Our net cash used in investing activities for the year ended December 31, 2025 increased by $157.3 million compared to the year ended December 31, 2024, primarily driven by a $154.7 million increase in business acquisitions, asset acquisitions, and escrow deposits and a $3.0 million increase in purchases of property and equipment during the year ended December 31, 2025 compared to the year ended December 31, 2024.
Previous wording
Our net cash provided by financing activities increased by $48.5 million for the year ended December 31, 2024 when compared to the year ended December 31, 2023 primarily due to an issuance of equity through a secondary offering totaling $118.1 million offset by a net repayment of debt totaling $65.0 million and payments for deferred financing costs of $3.9 million during the year ended December 31, 2024.
Current wording
Our net cash provided by financing activities increased by $122.9 million for the year ended December 31, 2025 when compared to the year ended December 31, 2024, primarily driven by an increase in net proceeds from our Amended Revolving Credit Facility of $140.0 million and an increase in proceeds from our Incremental Term Loans of $100.0 million. During the year ended December 31, 2024, we received $118.1 million through a secondary offering. Payments for deferred financing costs decreased $2.7 million during the year ended December 31, 2025 compared to the year ended December 31, 2024.