A month has gone by since the last earnings report for HCA Healthcare (HCA Quick QuoteHCA - Free Report) . Shares have lost about 2.7% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is HCA due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

HCA Healthcare's Q2 Earnings and Revenues Top Estimates

HCA Healthcare’ssecond-quarter 2021 adjusted earnings of $4.37 per share beat the Zacks Consensus Estimate of $3.17 by 37.9%. The bottom line also improved 191.3% year over year on higher revenues.

The company witnessed solid patient volumes in the quarter.

Quarterly Details

HCA Healthcare’s revenues of $14.35 billion beat the Zacks Consensus Estimate by 6.1%. The top line also improved 30.4% from the year-ago period’s figure.

Same facility equivalent admissions increased 26.8% year over year while same facility admissions rose 17.5% year over year. Same facility revenue per equivalent admission grew 2.6% year over year in the quarter.

Same facility inpatient surgeries and same facility outpatient surgeries rose 15% and 52.5%, respectively, year over year. These upsides were mainly on the back of solid recoveries on volume statistics.

Salaries and benefits, supplies and other operating expenses were up 19.8% year over year to $6.3 billion on higher supplies and other operating expenses.

Adjusted EBITDA totaled $3.219 billion, up 20.7% year over year.

As of Jun 30, 2021, HCA Healthcare operated 187 hospitals and approximately 2,000 sites of care.

Financial Update (as of Jun 30, 2021)

Total assets came in at $48.164 billion, up 1.4% from the level at 2020 end.

Total debt of $32.3 billion increased 4.9% from the level at 2020 end.

In the reported quarter, capex came in at $842 million minus acquisitions.

Cash flows used in operating activities were $2.251 billion compared with the year-ago period’s figure of $8.723 billion.

2021 Guidance

The company upped 2021 guidance following solid second-quarter results.

Management expects annual revenues in the band of $57-$58 billion.

Adjusted EBITDA is estimated to be $12.10-$12.50 billion.

Capex of the company is expected at $3.7 billion.

EPS of the company is projected at $16.30-$17.10 per share.

Share Repurchase and Dividend Update

The company’s board of directors recently resumed its share buyback policy, pertaining to which $2.287 billion was available for repurchase before its withdrawal.

HCA Healthcare announced a quarterly cash dividend of 48 cents per share on its common stock. The dividend is payable Sep 30, 2021 to its shareholders of record on Sep 16, 2021.

 

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 25.88% due to these changes.

VGM Scores

At this time, HCA has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise HCA has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.