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Why Is HCA (HCA) Up 12.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for HCA Healthcare (HCA - Free Report) . Shares have added about 12.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is HCA due for a pullback? 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 Q3 Earnings Miss on High Expense Level
HCA Healthcare reported third-quarter 2023 adjusted EPS of $3.91, which missed the Zacks Consensus Estimate by 1.5%. The bottom line dipped 0.5% year over year.
Revenues amounted to $16.2 billion, which improved 8.3% year over year in the quarter under review. The top line outpaced the consensus mark by 2.8%.
The quarterly results suffered a blow due to an elevated expense level and the soft performance of the Valesco physician staffing joint venture. Nevertheless, the downside was partly offset by growing patient admissions and a higher number of surgeries.
Quarterly Details
Same-facility equivalent admissions advanced 4.1% year over year in the third quarter, while same-facility admissions grew 3.4% year over year. The metrics beat our growth estimates of 1.5% and 2%, respectively.
Same-facility revenue per equivalent admission rose 3.6% year over year in the quarter under review but fell short of our growth estimate of 4%.
Same-facility inpatient surgeries grew 1.6% year over year but missed our growth estimate of 2.7%. Same-facility outpatient surgeries inched up 0.9% year over year but lagged our growth estimate of 2.7%. Additionally, same-facility emergency room visits advanced 3.5% year over year in the third quarter but missed our growth estimate of 4.5%.
Salaries and benefits, supplies and other operating expenses of $13.4 billion escalated 10.5% year over year and came higher than our estimate of $12.6 billion.
Adjusted EBITDA dipped 0.8% year over year to $2.9 billion in the quarter under review. HCA Healthcare operated 183 hospitals and roughly 2,300 ambulatory sites of care across 20 states and the United Kingdom as of Sep 30, 2023.
Financial Update (as of Sep 30, 2023)
HCA Healthcare exited the third quarter with cash and cash equivalents of $891 million, which slid 1.9% from the 2022-end level. It had a leftover capacity of $6.5 billion under its credit facilities at the third-quarter end. Total assets of $54.6 billion increased 4.1% from the figure at 2022 end.
Long-term debt, excluding debt issuance costs and discounts, amounted to $36.8 billion. The figure declined 2.4% from the figure as of Dec 31, 2022.
Capital expenditures were $1.1 billion minus acquisitions during the quarter under review.
Decline in Cash Flows
HCA Healthcare generated cash from operations of $2.5 billion in the third quarter, which dropped 17.9% year over year.
Capital Deployment Update
HCA bought back shares worth $1.1 billion in the third quarter. It had a leftover capacity of $1.7 billion under its buyback authorization as of Sep 30, 2023. The Board of Directors approved a quarterly cash dividend of 60 cents per share, which will be paid out on Dec 28, 2023, to its shareholders of record as of Dec 14.
2023 View
Annual revenues are presently estimated to lie between $63.5 billion and $64.5 billion compared with the previous guidance of $63.25-$64.75 billion. The midpoint of the revised outlook indicates a 6.3% rise from the 2022 reported figure.
Management currently projects adjusted EBITDA to be within $12.3-$12.6 billion for 2023, down from the prior view of $12.3-$12.8 billion. The midpoint of the updated outlook suggests 3.2% growth from the 2022 figure.
Net income attributable to HCA Healthcare is presently anticipated to lie between $4.940 billion and $5.130 billion compared with the previous outlook of $4.900-$5.255 billion.
EPS is currently forecasted to be in the $17.80-$18.50 band compared with the previous view of $17.70-$18.90. The midpoint of the revised guidance implies a 7.5% rise from the 2022 figure.
Earlier, capital expenditures, excluding acquisitions, were expected to be around $4.7 billion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -5.34% due to these changes.
VGM Scores
At this time, HCA has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. 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 B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, HCA has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is HCA (HCA) Up 12.3% Since Last Earnings Report?
A month has gone by since the last earnings report for HCA Healthcare (HCA - Free Report) . Shares have added about 12.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is HCA due for a pullback? 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 Q3 Earnings Miss on High Expense Level
HCA Healthcare reported third-quarter 2023 adjusted EPS of $3.91, which missed the Zacks Consensus Estimate by 1.5%. The bottom line dipped 0.5% year over year.
Revenues amounted to $16.2 billion, which improved 8.3% year over year in the quarter under review. The top line outpaced the consensus mark by 2.8%.
The quarterly results suffered a blow due to an elevated expense level and the soft performance of the Valesco physician staffing joint venture. Nevertheless, the downside was partly offset by growing patient admissions and a higher number of surgeries.
Quarterly Details
Same-facility equivalent admissions advanced 4.1% year over year in the third quarter, while same-facility admissions grew 3.4% year over year. The metrics beat our growth estimates of 1.5% and 2%, respectively.
Same-facility revenue per equivalent admission rose 3.6% year over year in the quarter under review but fell short of our growth estimate of 4%.
Same-facility inpatient surgeries grew 1.6% year over year but missed our growth estimate of 2.7%. Same-facility outpatient surgeries inched up 0.9% year over year but lagged our growth estimate of 2.7%. Additionally, same-facility emergency room visits advanced 3.5% year over year in the third quarter but missed our growth estimate of 4.5%.
Salaries and benefits, supplies and other operating expenses of $13.4 billion escalated 10.5% year over year and came higher than our estimate of $12.6 billion.
Adjusted EBITDA dipped 0.8% year over year to $2.9 billion in the quarter under review. HCA Healthcare operated 183 hospitals and roughly 2,300 ambulatory sites of care across 20 states and the United Kingdom as of Sep 30, 2023.
Financial Update (as of Sep 30, 2023)
HCA Healthcare exited the third quarter with cash and cash equivalents of $891 million, which slid 1.9% from the 2022-end level. It had a leftover capacity of $6.5 billion under its credit facilities at the third-quarter end. Total assets of $54.6 billion increased 4.1% from the figure at 2022 end.
Long-term debt, excluding debt issuance costs and discounts, amounted to $36.8 billion. The figure declined 2.4% from the figure as of Dec 31, 2022.
Capital expenditures were $1.1 billion minus acquisitions during the quarter under review.
Decline in Cash Flows
HCA Healthcare generated cash from operations of $2.5 billion in the third quarter, which dropped 17.9% year over year.
Capital Deployment Update
HCA bought back shares worth $1.1 billion in the third quarter. It had a leftover capacity of $1.7 billion under its buyback authorization as of Sep 30, 2023. The Board of Directors approved a quarterly cash dividend of 60 cents per share, which will be paid out on Dec 28, 2023, to its shareholders of record as of Dec 14.
2023 View
Annual revenues are presently estimated to lie between $63.5 billion and $64.5 billion compared with the previous guidance of $63.25-$64.75 billion. The midpoint of the revised outlook indicates a 6.3% rise from the 2022 reported figure.
Management currently projects adjusted EBITDA to be within $12.3-$12.6 billion for 2023, down from the prior view of $12.3-$12.8 billion. The midpoint of the updated outlook suggests 3.2% growth from the 2022 figure.
Net income attributable to HCA Healthcare is presently anticipated to lie between $4.940 billion and $5.130 billion compared with the previous outlook of $4.900-$5.255 billion.
EPS is currently forecasted to be in the $17.80-$18.50 band compared with the previous view of $17.70-$18.90. The midpoint of the revised guidance implies a 7.5% rise from the 2022 figure.
Earlier, capital expenditures, excluding acquisitions, were expected to be around $4.7 billion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -5.34% due to these changes.
VGM Scores
At this time, HCA has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. 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 B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, HCA has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.