Bernstein Cites Valuation, Downgrades HCA Healthcare to Market Perform

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HCA ($NYSE:HCA) Healthcare, a leading healthcare provider with locations throughout the United States, has recently received a downgrade from Bernstein Research to a ‘Market Perform’ rating. This is due to the current valuation of the company, which has become too expensive for Bernstein. It has been a leader in several areas, such as the launch of a digital health platform that connects patients to physicians and healthcare providers. Despite Bernstein’s downgrade of HCA’s stock, the company’s overall outlook remains positive.

It continues to focus on providing quality care and expanding its presence in the healthcare market. Bernstein’s decision to downgrade HCA could be seen as an opportunity for investors to buy now and reap the rewards later as the stock value rises.

Market Price

On Thursday, HCA HEALTHCARE stock opened at $271.9 and closed at $273.1, a 0.4% increase from its previous closing price of 272.1. Despite the marginal increase, Bernstein analyst Kevin Fischbeck downgraded the stock to Market Perform from Outperform due to its high valuation. It also provides services through its subsidiaries, including outpatient care centers, home health agencies, and nursing centers. Fischbeck’s decision is reflective of HCA HEALTHCARE’s current valuations, which he believes are too high based on the company’s performance in recent quarters. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Hca Healthcare. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Hca Healthcare. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Hca Healthcare. More…

Key Ratios Snapshot

Some of the financial key ratios for Hca Healthcare are shown below. More…

Analysis

GoodWhale conducted an analysis of HCA HEALTHCARE‘s fundamentals and found that it has a high health score of 8/10 considering its cashflows and debt, indicating that it is capable to sustain future operations in times of crisis. HCA HEALTHCARE was classified as ‘rhino’, a type of company we conclude that has achieved moderate revenue or earnings growth. Given this information, we believe that HCA HEALTHCARE may be attractive to investors who are looking for companies that are strong in asset, dividend, profitability, and medium in growth. These investors may find this company’s solid fundamentals and modest growth to be an attractive opportunity. With its ability to withstand financial crises, HCA HEALTHCARE is likely to be a reliable and profitable investment. More…

Peers

HCA Healthcare Inc is a healthcare company that operates in the United States. The company’s competitors include Universal Health Services Inc, Tenet Healthcare Corp, and Community Health Systems Inc.

– Universal Health Services Inc ($NYSE:UHS)

Universal Health Services, Inc. is one of the largest healthcare management companies in the United States. The company owns and operates hospitals, physician groups, ambulatory surgery centers, and other healthcare facilities. Universal Health Services is headquartered in King of Prussia, Pennsylvania.

– Tenet Healthcare Corp ($NYSE:THC)

Tenet Healthcare Corporation is an American for-profit healthcare services company based in Dallas, Texas. through its subsidiaries, the company owns and operates hospitals, outpatient facilities, and Conifer Health Solutions, a health services company. As of February 2021, Tenet operated 79 hospitals and more than 470 outpatient centers in the United States.

– Community Health Systems Inc ($NYSE:CYH)

Community Health Systems Inc (CHS) is a for-profit operator of general acute care hospitals. As of 2022, it has a market capitalization of 311.19 million and a return on equity of -48.01%. The company’s hospitals offer a wide range of services, including emergency care, surgery, laboratory and imaging services. CHS also owns and operates a number of home health, hospice and outpatient facilities.

Summary

Investment analysts at Bernstein recently downgraded their rating on healthcare giant HCA Healthcare from Outperform to Market Perform, citing the company’s current valuation. This shift came after an impressive run for HCA over the last year, which saw the company’s stock price more than double in value. Despite this, Bernstein believes the stock is now overvalued and that further upside potential is limited. Investors should remain cautious and consider potential risks before making any investment decisions.