Cash generation remains inconsistent, evidenced by a volatile OCF/NI ratio that swung from 4.89 in 2025Q2 to a negative 2.73 in 2025Q1.
| Cash from Operations | 66.12M | 48.29M | 39.3M | 33.09M | 9.04M | -18.22M | 50.2M | 9.55M | 23.27M | 17.25M |
| Operating CF Margin % | - | 5.1% | 5.65% | 6.07% | 1.91% | -4.14% | 12.84% | 2.82% | 8.14% | 6.87% |
| Operating CF Growth % | 397.04% | 22.89% | 18.76% | 265.88% | 149.63% | -136.3% | 425.48% | -58.95% | 34.93% | - |
| Net Income | 30.32M | 29.58M | 24.34M | 13.91M | 7.24M | 2.15M | 15.55M | 3.17M | 16.28M | 10.03M |
| Depreciation & Amortization | 12.91M | 0 | 6.12M | 5.13M | 4.9M | 4.78M | 4.67M | 3.81M | 2.96M | 2.54M |
| Stock-Based Compensation | 8.66M | 0 | 7.78M | 5.37M | 3.09M | 10.04M | 8.34M | 3.38M | 2.38M | 2.3M |
| Deferred Taxes | -1.87M | 0 | -1.19M | 4M | 1.7M | -1.75M | -2.2M | 79K | -595K | -160K |
| Other Non-Cash Items | -13.66M | 20.31M | 1.32M | 1.24M | 1.62M | 3.94M | 890K | 1.16M | 941K | 3.53M |
| Working Capital Changes | 12.47M | -1.59M | 929K | 3.44M | -9.5M | -37.38M | 22.95M | -2.05M | 1.3M | -993K |
| Change in Receivables | -10.3M | -24.15M | -21.09M | -7.35M | -361K | -7.33M | -15.71M | -8.57M | -2.57M | -5.71M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 9.67M | 269K | 1.77M | 3.02M |
| Change in Payables | 3.24M | 5.8M | 8.05M | -1.84M | 2.37M | 562K | 993K | 4.07M | 1.37M | 432K |
| Cash from Investing | -183.05M | -227.97M | -70.68M | -30.22M | -24.24M | -20.12M | -41.62M | -26.46M | -9.48M | -16.08M |
| Capital Expenditures | -18.77M | 0 | -8.99M | -8.11M | -14.17M | -6.3M | -7.25M | -6.71M | -3.6M | -3.13M |
| CapEx % of Revenue | 1.83% | 2.32% | 1.29% | 1.49% | 2.99% | 1.43% | 1.86% | 1.98% | 1.26% | 1.25% |
| Acquisitions | -104.44M | 0 | -48.42M | -21.38M | -10.13M | -13.55M | -33.19M | -18.76M | -4.72M | -12.06M |
| Investments | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -57.38M | -227.97M | -13.28M | -741K | 61K | -267K | -1.17M | -991K | -1.15M | -891K |
| Cash from Financing | 116.62M | 172.46M | 49.57M | 1.11M | 12.08M | 43.49M | -8.95M | 17.27M | -13.79M | -1.16M |
| Debt Issued (Net) | 117.05M | 173.8M | -65M | 500K | 11M | 44M | -10.5M | 20M | 0 | 0 |
| Equity Issued (Net) | 1.43M | 552K | 119M | 579K | 1.08M | 0 | -65K | 0 | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -11.6M | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | 0 | 0 | 0 | -65K | -2.69M | -1.97M | -1.16M |
| Other Financing | -1.85M | -1.89M | -4.43M | 33K | 0 | -510K | 1.62M | 8.87M | -13.79M | -1.16M |
| Net Change in Cash | -309K | -7.22M | 18.19M | 3.98M | -3.11M | 5.15M | -359K | 361K | 5K | 6K |
| Free Cash Flow | 47.34M | 26.3M | 30.31M | 24.98M | -5.13M | -24.53M | 42.95M | 2.84M | 19.67M | 14.12M |
| FCF Margin % | 4.63% | 2.77% | 4.36% | 4.59% | -1.08% | -5.58% | 10.99% | 0.84% | 6.88% | 5.62% |
| FCF Growth % | 443.18% | -13.23% | 21.3% | 587.42% | 79.1% | -157.1% | 1412.36% | -85.56% | 39.35% | - |
| FCF per Share | 1.32 | 0.74 | 0.95 | 0.83 | -0.17 | -0.80 | 1.42 | 0.10 | 0.70 | 0.50 |
| FCF Conversion (FCF/Net Income) | 1.56x | 1.63x | 1.74x | 2.47x | 1.36x | -6.76x | 3.19x | 3.75x | 1.48x | 1.75x |
| Interest Paid | 1.21M | 4.9M | 6.52M | 5.01M | 3.03M | 1.45M | 1.12M | 156K | 0 | 0 |
| Taxes Paid | 3.1M | 14.05M | 7.35M | 841K | 99K | 2.62M | 7.87M | 120K | 0 | 0 |
Working capital volatility
As reported in recent financial statements, PNTG exhibits significant volatility in cash conversion, with the OCF/NI ratio swinging from a high of 4.89 in 2025Q2 to a negative 2.73 in 2025Q1, highlighting a disconnect between accounting net income and actual cash generation from operations.
The extreme variance in the OCF/NI ratio suggests that net income is a poor proxy for the company's immediate liquidity needs. Investors should monitor whether these swings are driven by seasonal billing cycles or underlying inefficiencies in the revenue collection process.
Based on the provided cash flow data, PNTG's free cash flow trajectory remains highly erratic, with quarterly margins fluctuating between a negative 11.1% in 2025Q1 and a positive 14.4% in 2025Q2, indicating that consistent cash generation is not yet a hallmark of the current business model.
The inability to maintain positive free cash flow across consecutive quarters suggests that the company's rapid growth phase is consuming significant internal resources. This inconsistency may indicate that the business is currently prioritizing market share expansion over the stabilization of its cash-generating capabilities.
According to quarterly cash flow filings, working capital changes have frequently acted as a significant drag on liquidity, most notably in 2025Q1 when a $35.1M outflow severely impacted the company's ability to fund operations through internal cash flow alone, necessitating careful scrutiny of accounts receivable.
The recurring negative impact of working capital changes suggests that the company's collection cycles are either lengthening or being disrupted by the integration of new acquisitions. This trend warrants further investigation into whether the decentralized operating model is creating friction in the billing and reimbursement cycle.
As evidenced by the $95.2M acquisition outflow in 2025Q4, PNTG is aggressively deploying capital toward inorganic growth, which appears to be the primary driver of the company's current cash usage profile rather than organic reinvestment or shareholder return programs like dividends or share repurchases.
The heavy reliance on acquisitions to drive growth suggests that management views the current market environment as an opportunity to consolidate smaller agencies. However, this strategy places immense pressure on the balance sheet and requires sustained operational success to justify the high upfront cash costs.
Quick answers to the most common questions about buying PNTG stock.
The Pennant Group, Inc. (PNTG) generated $48.3M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
The Pennant Group, Inc. (PNTG) generated $26.3M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
The Pennant Group, Inc. (PNTG) spent $0.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.