HCA Healthcare is the IBD Stock Of The Day. The hospital operator is serving up a couple of possible buying opportunities as the omicron wave recedes. HCA stock rose Wednesday.
The Nashville-based company owns and operates general acute-care hospitals in the U.S. and U.K. Elective surgeries, a big moneymaker for hospitals, were largely postponed for two years as hospitals wrestled with the Covid pandemic. But as omicron infections decline, more elective procedures are now heading back to the operating table.
But Covid-19 will still be a major part of HCA's services this year.
"As I indicated previously, we believe demand for health care services will be strong in 2022 and comparable to historical growth rates in the 2%-to-3% zone with Covid-related admissions representing between 3% and 5% of total," CEO Sam Hazen said during the fourth-quarter earnings call in January. "We expect this demand to be supported by a growing economy and more insurance coverage for people through their employer or the exchanges."
As more people have employer-provided health coverage amid a drop in unemployment, health insurance stocks are also performing well. UnitedHealth Group is trying to break out of a double-bottom base.
HCA Stock Basing
HCA shares rose 2.45% to 264.36 on the stock market today.
HCA stock closed Wednesday 2% below a 269.85 buy point in a cup base. This base followed a failed early-January breakout attempt from a double-bottom base. On Wednesday, the stock climbed briefly above a high notched on March 3, setting out an early entry at 266.21 for more experienced investors.
The relative strength line, which tracks performance vs. the S&P 500 index, moved to a new high ahead of a possible breakout, a very bullish sign.
HCA Fundamentals
HCA has a Composite Rating of 85 out of 99 and an EPS Rating of 92. The Composite Rating compiles scores on key fundamental and technical metrics: earnings and sales growth, profit margins, return on equity, and relative price performance. Investors should generally focus on stocks with a Composite Rating of 90 or higher.
The company reported mixed fourth-quarter results in January. It sees 2022 earnings of $18.40 to $19.20 per diluted share and revenue of $60 billion to $62 billion
HCA stock is the second-ranked stock in IBD's Medical-Hospitals group. Tenet Healthcare is the top-ranked stock. THC stock is extended out of buy range after breaking out of a consolidation with an 83.79 entry point.
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