QM · rank #7 · 2026-10-20
PACS
NYSE · $7.56B (USD)
The exact numbers the algorithm saw.
| Momentum 12-1 Return from 12 months ago to 1 month ago. | +251.88% |
|---|---|
| ROE TTM Return on equity, trailing 12 months. | +27.9% |
| Profit margin Net profit margin, trailing 12 months. | +4.9% |
| Market cap (USD) Size filter: > $500M required. | $7.56B |
| Anchor (recent) Close on 2026-09-18 | $42.12 |
| Anchor (far) Close on 2025-09-19 | $11.97 |
The AI research card
Independent qualitative review of each pick before the order is placed. On the rare day the research service is unavailable, the paper book trades on the quant ranking alone and no card appears here.
Summary
PACS Group is a large U.S. post-acute and skilled-nursing operator running 324 facilities with 35,631 beds, growing primarily through acquisition and cohort maturation rather than proprietary technology.
Rationale
The quality-momentum signal is reinforced by concrete fundamentals — 28% trailing ROE, Q2 net income up ~50% YoY, raised full-year EBITDA guidance implying ~29% growth, and a clean balance sheet with zero revolver draw — suggesting the momentum is earnings-driven, not sentiment-only.
Material risks
- 1Reimbursement and CMS policy risk is the single most thesis-breaking factor: PACS has no proprietary moat and derives the bulk of revenue from government payers, so a rate cut or coverage-rule change could rapidly compress the EBITDA margin expansion that is driving the momentum signal.
- 2Acquisition integration execution — particularly the 14 still-unclosed Eduro facilities and the broader M&A pipeline — is the primary growth lever, and any delay, cost overrun, or labor-driven occupancy shortfall in maturing cohorts would directly undercut the earnings trajectory underpinning the quality score.
AI verdict council
Each pick is reviewed independently by 3 models before any order. 3 of 3 voted to proceed.