Brookdale’s second quarter was met with a negative market reaction, as both revenue and non-GAAP earnings per share fell short of Wall Street expectations. Management highlighted that operational improvements, particularly in occupancy, were a key driver, with same-community occupancy rising nearly two percentage points year over year. Interim CEO Denise Warren pointed to the impact of targeted initiatives, including SWAT teams and local incentives, in moving underperforming communities up the occupancy curve. However, the company acknowledged that cost containment remains a work in progress, and that transition costs related to asset dispositions weighed on results.

Is now the time to buy BKD? Find out in our full research report (it’s free).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Brookdale’s Q2 Earnings Call

• Brian Gil Tanquilut (Jefferies) asked about operational initiatives since Denise Warren became Interim CEO. Warren emphasized SWAT teams, local accountability, and daily coordination to drive profitable occupancy and operational improvements.

• Benjamin Hendrix (RBC Capital Markets) inquired about the sustainability of the spread between rate and expense growth. CFO Dawn Kussow stated that margin expansion is expected as occupancy improves and rate growth is maintained above expense growth.

• Andrew Mok (Barclays) questioned the timeline for moving underperforming communities out of the sub-70% occupancy band. Kussow confirmed ongoing SWAT team efforts and asset dispositions, with most transitions expected within 12-18 months.

• Joanna Sylvia Gajuk (Bank of America) followed up on why higher EBITDA guidance did not translate to higher free cash flow guidance. Kussow cited variability in working capital and timing of severance and proxy fight expenses.

• Joshua Richard Raskin (Nephron Research) asked about local differentiation and the role of Health Plus. Management highlighted Health Plus as a key differentiator that improves resident outcomes and is expected to drive move-ins and retention.

Catalysts in Upcoming Quarters

In the coming quarters, our team will monitor (1) the pace of asset dispositions and transitions, as successful execution will be key to improving portfolio quality; (2) the ability to sustain occupancy above 80%, which is crucial for cash flow and margin improvement; and (3) the impact of ongoing cost rationalization efforts as the company aligns its expense base to a smaller, more focused portfolio. We will also watch for progress in Health Plus adoption and its effect on resident retention and satisfaction.

Brookdale currently trades at $7.23, down from $7.79 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).

Our Favorite Stocks Right Now

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.