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Valued at $82.3 billion by market cap, HCA Healthcare, Inc. (HCA) is a significant provider of healthcare services, specializing in operating hospitals and outpatient facilities across the U.S. Based in Nashville, Tennessee, the company offers a comprehensive range of medical services and innovative care solutions, catering to diverse patient needs through its extensive nationwide network of hospitals, clinics, and care facilities.
Shares of HCA Healthcare have lagged behind the broader market over the past year. Over the past 52 weeks, the stock gained 28.4% compared to the S&P 500 Index’s ($SPX) 31% returns. In 2024, HCA is up 20% versus SPX’s 25.2% gains on a YTD basis.
However, zooming in further, HCA outperformed the SPDR S&P Health Care Services ETF (XHS). The exchange-traded fund has gained 11.8% over the past year and 7.4% on a YTD basis.
On Oct. 25, HCA Healthcare's stock dropped 8.9% following its Q3 earnings report. The company delivered revenue of $17.49 billion, aligning with analyst expectations and reflecting a 7.9% year-over-year increase. Non-GAAP EPS came in strong at $5.50, exceeding the consensus estimate of $4.97.
Adjusted EBITDA for Q3 reached $3.26 billion, up from $2.88 billion in Q3, highlighting continued operational growth despite the market reaction. The company reaffirmed its 2024 guidance, anticipating results at the lower end of the range due to hurricane impacts, with projected capital expenditures of $5 billion.
For the current fiscal year, ending in December, analysts expect HCA’s EPS to grow 15.6% to $21.97 on a diluted basis. The company’s earnings surprise history is robust. It beat the consensus estimate in each of the last four quarters.
Among the 25 analysts covering HCA stock, the consensus rating is a “Strong Buy.” That’s based on 18 “Strong Buy” ratings, one “Moderate Buy,” and six “Holds.”
This configuration is more bullish than a month ago, with 16 analysts suggesting a “Strong Buy.”
On Nov. 15, Bank of America Securities (BAC) analyst Joanna Gajuk maintained a “Buy” rating on HCA Healthcare.
The mean price target is $411.29, representing a 26.6% premium compared to HCA’s current price levels. The Street-high price target of $460 suggests an ambitious upside potential of 41.5%.
