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Tenet Healthcare Corporation (THC - Free Report) delivered third-quarter 2018 adjusted net earnings of 29 cents per share, outperforming the Zacks Consensus Estimate by 163.6%. This upside is primarily driven by the performance of the USPI and Conifer Segments. Moreover, the bottom line reversed the year-ago loss of 17 cents.
Tenet Healthcare Corporation Price, Consensus and EPS Surprise
Net operating revenues came in at $4.5 billion, down 2.1% year over year. However, the top line beat the Zacks Consensus Estimate by 2.5%. This was due to weak performances by the company’s hospitals.
Tenet Healthcare’s same-hospital exchange admissions were 4577, down 4% year over year.
Same-hospital exchange outpatient visits were 51,539, up 8.1% year over year.
Quarterly Segment Details
Hospital & Other
Net operating revenues in the Hospital Operations and Other segment totaled $3.7 billion, down 2.7% year over year. This downside is largely attributable to hospital divestitures, partially offset by same hospital revenue growth.
On same-hospital basis, patient revenues were $3.4 billion, up 6% year over year.
Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $312 million, up 16% year over year.
Ambulatory Segment
The Ambulatory segment generated net operating revenues of $502 million, up 7.3% year over year.
Additionally, the segment reported adjusted EBITDA of $184 million, up 15.7% year over year.
Conifer Segment
Conifer’s revenues decreased 7.5% from the prior-year quarter’s level to $371 million. This was mainly due to the company’s divestment activities by Tenet and other customers.
The segment reported $81 million of adjusted EBITDA in the quarter under review, up 2.5% year over year.
Financial Position
As of Sep 30, 2018, Tenet Healthcare had cash and cash equivalents of $500 million, down 18.2% from the number at year-end 2017.
The company exited the third quarter with $14.1 billion of long-term debt, down 4.1% from the count at 2017 end.
Net cash provided by operating activities for the first nine months of 2018 stands at $799 million, up 12.7% year over year.
2018 Outlook
Adjusted earnings per share are projected between $1.44 and $1.83, down from the earlier projection of $1.54-$1.88.
Tenet Healthcare’s expectation for revenues is in the range of $18.1-$18.3 billion, up from $17.9-$18.3 billion.
Adjusted EBITDA is now estimated between $2.52 and $2.57 billion, down from the previous range of $2.55-$2.65 billion.
Tenet Healthcare now projects its adjusted free cash flow of $600-$800 million, down from $725-$925 million.
The company has lowered its net cash provided by operating activities from $1.245-$1.550 billion to $1.060-$1.335 billion.
Q418 Guidance
The company now anticipates revenues in the band of $4.42-$4.62 billion, up from the earlier prediction of $4.3-$4.5 billion.
The company now envisions adjusted EBITDA between $649 million and $699 million, up from the previous forecast of $575-$625 million.
The company increased the high end of its adjusted earnings per share from continuing operations to a range of 10 cents to 48 cents from the past estimate of 10-24 cents.
Among other players from the HMO industry having reported third-quarter earnings so far, the bottom line of Anthem Inc. , Centene Corporation (CNC - Free Report) and UnitedHealth Group Inc. (UNH - Free Report) beat the respective Zacks Consensus Estimate.
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Tenet Healthcare's (THC) Q3 Earnings Beat, Increase Y/Y
Tenet Healthcare Corporation (THC - Free Report) delivered third-quarter 2018 adjusted net earnings of 29 cents per share, outperforming the Zacks Consensus Estimate by 163.6%. This upside is primarily driven by the performance of the USPI and Conifer Segments. Moreover, the bottom line reversed the year-ago loss of 17 cents.
Tenet Healthcare Corporation Price, Consensus and EPS Surprise
Tenet Healthcare Corporation Price, Consensus and EPS Surprise | Tenet Healthcare Corporation Quote
Quarterly Operational Update
Net operating revenues came in at $4.5 billion, down 2.1% year over year. However, the top line beat the Zacks Consensus Estimate by 2.5%. This was due to weak performances by the company’s hospitals.
Tenet Healthcare’s same-hospital exchange admissions were 4577, down 4% year over year.
Same-hospital exchange outpatient visits were 51,539, up 8.1% year over year.
Quarterly Segment Details
Hospital & Other
Net operating revenues in the Hospital Operations and Other segment totaled $3.7 billion, down 2.7% year over year. This downside is largely attributable to hospital divestitures, partially offset by same hospital revenue growth.
On same-hospital basis, patient revenues were $3.4 billion, up 6% year over year.
Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $312 million, up 16% year over year.
Ambulatory Segment
The Ambulatory segment generated net operating revenues of $502 million, up 7.3% year over year.
Additionally, the segment reported adjusted EBITDA of $184 million, up 15.7% year over year.
Conifer Segment
Conifer’s revenues decreased 7.5% from the prior-year quarter’s level to $371 million. This was mainly due to the company’s divestment activities by Tenet and other customers.
The segment reported $81 million of adjusted EBITDA in the quarter under review, up 2.5% year over year.
Financial Position
As of Sep 30, 2018, Tenet Healthcare had cash and cash equivalents of $500 million, down 18.2% from the number at year-end 2017.
The company exited the third quarter with $14.1 billion of long-term debt, down 4.1% from the count at 2017 end.
Net cash provided by operating activities for the first nine months of 2018 stands at $799 million, up 12.7% year over year.
2018 Outlook
Adjusted earnings per share are projected between $1.44 and $1.83, down from the earlier projection of $1.54-$1.88.
Tenet Healthcare’s expectation for revenues is in the range of $18.1-$18.3 billion, up from $17.9-$18.3 billion.
Adjusted EBITDA is now estimated between $2.52 and $2.57 billion, down from the previous range of $2.55-$2.65 billion.
Tenet Healthcare now projects its adjusted free cash flow of $600-$800 million, down from $725-$925 million.
The company has lowered its net cash provided by operating activities from $1.245-$1.550 billion to $1.060-$1.335 billion.
Q418 Guidance
The company now anticipates revenues in the band of $4.42-$4.62 billion, up from the earlier prediction of $4.3-$4.5 billion.
The company now envisions adjusted EBITDA between $649 million and $699 million, up from the previous forecast of $575-$625 million.
The company increased the high end of its adjusted earnings per share from continuing operations to a range of 10 cents to 48 cents from the past estimate of 10-24 cents.
Zacks Rank and Performance of Other Players
Tenet Healthcare carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other players from the HMO industry having reported third-quarter earnings so far, the bottom line of Anthem Inc. , Centene Corporation (CNC - Free Report) and UnitedHealth Group Inc. (UNH - Free Report) beat the respective Zacks Consensus Estimate.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>