Shares of Community Health Systems Inc. (CYH Quick QuoteCYH - Free Report) plunged 13.1% in after-hour trading on Aug 2, following another dismal quarterly result.

Community Health reported adjusted earnings of 9 cents per share in the second quarter of 2016, which missed the Zacks Consensus Estimate of 58 cents and also plunged 92.1% from the year-ago quarter. The downside can be primarily attributed to revenue decline as well as higher operating expenses.

Net operating revenues decreased 6% to almost $4.59 billion, which, however, beat the Zacks Consensus Estimate of $4.54 billion.

On Apr 29, Community Health completed the spin-off of Quorum Health Corporation (QHC), comprising of 38 affiliated hospitals and related outpatient services in 16 states, together with Quorum Health Resources. It is a subsidiary providing management advisory and consulting services to non-affiliated hospitals.
 

Total admissions decreased 9.1% while adjusted admissions declined 8.5%. Outpatient revenues accounted for 57.2% of total patient revenues compared with 57% in the year-ago quarter.

On a same-store basis, net operating revenues increased 1.2% on a year over year basis.  On a same-store basis, admissions decreased 2.1% and adjusted admissions declined 0.6%.

Adjusted EBITDA fell almost 27% year over year to $563 million.
 

Zacks Rank & Key Picks

Community Health carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader medical sector include AMN Healthcare , The Advisory Board and VCA Inc. (WOOF Quick QuoteWOOF - Free Report) . While AMN Healthcare and The Advisory Board sports Zacks Rank #1 (Strong Buy), VCA has a Zacks Rank #2 (Buy).

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