Jefferies upgraded Cencora to Buy while cutting Acadia Healthcare and Chemed to Hold. The firm expects healthcare services stocks to trade on operating fundamentals in 2026 as policy risk fades. Analysts cite improved long-range plans for Cencora and headwinds for the others.

The upgrade for Cencora reflects easing concerns around Walgreens store closures and government drug pricing. Jefferies sees multi-year tailwinds for drug distributors supporting valuation expansion. For Acadia, Medicaid pressures and balance sheet deterioration prompted the downgrade, with near-term catalysts limited until same-facility metrics improve.

Chemed’s downgrade centers on a slower-than-expected recovery at its Roto-Rooter business, overshadowing gains at hospice unit VITAS. Persistent margin headwinds and limited visibility make a return to normalized growth unlikely in 2026. Jefferies expects limited legislative activity ahead of the U.S. midterm elections to favor the sector.