Engine Capital, an activist investor that owns approximately 3% of Acadia Healthcare, sent a letter Sept. 24 to the Franklin, Tenn.-based company’s board of directors outlining recommendations to improve shareholder value.
Engine criticized Acadia’s executive turnover, capital allocation decisions and operating structure, citing a shift from geographic leadership to service-line reporting as a key factor in the company’s performance decline. Acadia trades at an enterprise value to 2026 earnings before interest, taxes, depreciation and amortization of less than 6.0x and a 2026 maintenance free-cash-flow yield of more than 17%.
The firm also urged Acadia to halt all growth capital investments, reduce overhead, sell assets and repurchase shares. The company has invested more than $2 billion in capital expenditures since 2022, including $1.6 billion to add approximately $1.25 billion of shares — more than 60% of its current market capitalization — through asset sales and free cash flow.
Engine also called for a board refresh and recommended appointing directors with behavioral health and capital allocation experience. The firm noted that Acadia has more than $750 million in tax credits, with a portion set to expire in 2026.
Acadia Healthcare released a statement in response, stating they are committed to increasing long-term shareholder value while maintaining open communication. The company aims to focus on expanding access to high-quality behavioral healthcare, improving clinical outcomes and enhancing operational efficiency across their network, according to a Sept. 24 news release.
