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Valued at $103.6 billion by a market cap, HCA Healthcare, Inc. (HCA) owns and operates a wide range of healthcare facilities in the U.S. Based in Nashville, Tennessee, the company offers a wide range of services, including medical, surgical, outpatient, and behavioral health care.
Companies valued at $10 billion or more are generally labeled “large-cap” stocks, and HCA fits this criterion perfectly. HCA is renowned for being one of the largest for-profit healthcare operators, owning 186 hospitals and approximately 2,000 care sites across the U.S. and the U.K., including surgery and urgent care centers.
Despite a slight pullback from its 52-week high of $395.91, reached on Aug. 30, shares of the hospital operator have gained 18.1% over the past three months, outperforming the broader iShares U.S. Healthcare Providers ETF’s (IHF) 13.7% returns over the same time frame.
Longer term, HCA stock is up 46.2% on a YTD basis, significantly outpacing IHF’s 11.3% gains. Moreover, shares of HCA have rallied 41.6% over the past 52 weeks, surpassing IHF’s 15.4% returns over the same time frame.
HCA has been trading above its 200-day moving average since December last year and remained mostly above its 50-day moving average over this time frame despite some fluctuations, indicating a bullish trend.
HCA’s outperformance can be attributed to rising demand and a favorable payer mix, with increased commercial insurance payments and effective management of labor and supply expenses. Moreover, the stock surged 4.6% following its better-than-expected Q2 earnings release on Jul. 23. Rising admissions and a higher number of inpatient and outpatient surgeries drove this performance. HCA's raised annual profit forecast and positive growth outlook further boosted investor confidence.
However, its rival, Tenet Healthcare Corporation (THC), has soared 111.2% over the past 52 weeks and gained 119.5% on a YTD basis, outpacing HCA’s gains over both time frames.
Analysts remain optimistic about the stock's prospects, with HCA outperforming the broader market. HCA has a consensus rating of “Strong Buy” from the 22 analysts in coverage, and as of writing, the company is trading above its mean price target of $383.57.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
