MeritValue

PACS Group, Inc.

PACSdata completeness 88%4 fiscal years on file

Data notes: no data for concept 'capex'; no data for concept 'interestExpense'

The thesis, from the filings

PACS Group, Inc. earns about 379% on invested capital, but has diluted owners by 22% over 4 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $8.71 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2022FY 2023FY 2024FY 2025
Revenue$2.4B1$3.11B2$4.09B2$5.29B2
Net income$150.5M3$112.9M4$55.8M4$191.5M4
Operating cash flow$92.6M5$63.7M6$367.3M6$404.2M6
Capital expenditure————
Free cash flow (derived)————
Total debt—$212.5M7$677.7M8$602.5M8
Cash & equivalents$58.3M9$73.4M10$157.7M10$197M10
Diluted shares128.7M128.7M148.6M156.7M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$60.42
your share of equity
Profit it earned you last year
$12.22
Free cash flow it threw off
—
Debt you’d be carrying
$38.45

10 shares is a claim on $60.42 of net worth that earned you $12.22 last year, against $38.45 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
379% avg · 4y
FY22 1450%FY23 48%FY24 5%FY25 14%

It earned an average 379% on invested capital over 4 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+22% shares · 4y

Share count is up 22% over 4 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 183% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
DCF · Growth Exit 5Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
Earnings Power Value
$8.71
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$131.7M
  • growthAssumed0.0%
Graham Number
$12.88
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2022-12-31 · accession 0002001184-25-000068 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2023-12-31 · accession 0002001184-26-000005 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2022-12-31 · accession 0002001184-25-000068 (NetIncomeLoss)
  4. 10-K · period ending 2023-12-31 · accession 0002001184-26-000005 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0002001184-25-000068 (NetCashProvidedByUsedInOperatingActivities)
  6. 10-K · period ending 2023-12-31 · accession 0002001184-26-000005 (NetCashProvidedByUsedInOperatingActivities)
  7. 10-K · period ending 2023-12-31 · accession 0002001184-25-000068 (LongTermDebtNoncurrent)
  8. 10-K · period ending 2024-12-31 · accession 0002001184-26-000005 (LongTermDebtNoncurrent)
  9. 10-K · period ending 2022-12-31 · accession 0002001184-25-000068 (CashAndCashEquivalentsAtCarryingValue)
  10. 10-K · period ending 2023-12-31 · accession 0002001184-26-000005 (CashAndCashEquivalentsAtCarryingValue)