We recently published a list of the 11 Most Promising Small-Cap Stocks According to Analysts. In this article, we are going to take a look at where Acadia Healthcare Company, Inc. (NASDAQ:ACHC) stands against other promising small-cap stocks.
Robert Teeter of Silvercrest Asset Management recently appeared in an interview to express that he thinks small-cap stocks are currently facing a choppy market, but he also acknowledged that he anticipates a rally later in the year. Based on this sentiment, he advised clients on the importance of diversification within the S&P 500 and pointed to opportunities in international markets. We covered his stance in greater detail in one of our other articles, 10 Best Small-Cap Value Stocks to Buy Now. Here’s an excerpt from it:
“He noted that the Trump trade initially boosted small caps due to expectations of economic acceleration and lower interest rates, both of which are favorable for these companies. However, policy uncertainty and weaker-than-expected economic data have delayed their rally. Teeter believes that small caps will come into their own later in the year, but for now, they are facing a choppy market with significant rotation.”
However, later on March 26, Villere & Co. Portfolio Manager George Young joined ‘Market Domination Overtime’ on Yahoo Finance to discuss why investors should be looking at small-cap stocks. George Young stated that small caps currently appear cheap and have been underperforming relative to larger stocks. He highlighted that small-cap stocks have been inexpensive for a while. To support his stance, he pointed out that last year, the S&P 500 rose about 25%, while small-cap stocks increased by only 11%. He explained that this disparity suggests a regression to the mean at some point, which means that the valuation gap between small caps and large caps should eventually narrow. Young also noted a shift in market dynamics during Q1 of this year. While the S&P 500 was down ~2% then, the S&P 500 excluding the MAG7 stocks was actually up ~2%. He described this change as a relatively usual once, since stock market leadership often rotates between sectors and types of stocks. Young particularly favored the small-cap sector when questioned about long-term and steady investments.
Our Methodology
We sifted through the Finviz stock screener to compile a list of the top small-cap stocks that were trading between $300 million and $2 billion, and that had the highest upside potential (at least 40%). The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q4 2024, which was sourced from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A healthcare professional discussing a treatment plan with a patient in an outpatient clinic.
Acadia Healthcare Company, Inc. (NASDAQ:ACHC)
Market Capitalization as of April 23: $1.99 billion
Number of Hedge Fund Holders: 46
Average Upside Potential as of April 23: 84.59%
Acadia Healthcare Company, Inc. (NASDAQ:ACHC) provides behavioral healthcare services in the US and Puerto Rico. It develops and operates acute inpatient psychiatric facilities, specialty treatment facilities that include residential recovery facilities & eating disorder facilities, comprehensive treatment centers, and residential treatment centers.
In 2024, Acadia (NASDAQ:ACHC) completed the construction on ~1,300 beds, with ~1,100 completed during Q4. A total of 776 new beds became operational in 2024, which included the opening of 4 new acute inpatient hospitals. In Q4 alone, 577 newly constructed beds became operational, with 344 of these in new facilities. This continued into the first 2 months of 2025, with an additional 313 licensed beds added.
Same facility patient days also grew by 3.2% in Q4 and remained stable between 3% and 4% throughout the quarter. Acadia (NASDAQ:ACHC) is also growing through Twin Venture Partnerships with well-respected health systems. It opened a 144-bed joint venture hospital with Intermountain Health in Denver in Q4 and a 192-bed joint venture hospital with Henry Ford Health in Detroit recently. In 2025, Acadia expects to add between 800 and 1,000 total beds.
Overall, ACHC ranks 6th on our list of the most promising small-cap stocks according to analysts. While we acknowledge the growth potential of ACHC, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than ACHC but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
