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Why HCA Healthcare (HCA) is a Smart Addition to Your Portfolio
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HCA Healthcare, Inc. (HCA - Free Report) is aided by growing surgery cases, acquisitions of healthcare facilities and solid operating cash flows. A positive business outlook for 2024 reinforces investors’ confidence in the stock.
Top Zacks Rank & Upbeat Price Performance
HCA Healthcare currently carries a Zacks Rank #2 (Buy).
The stock has gained 21.2% year to date compared with the industry’s 18.7% growth. The Zacks Medical sector has rallied 2.2% and the S&P 500 composite has risen 9.2% in the same time frame.
Image Source: Zacks Investment Research
Favorable Style Score
HCA Healthcare carries an impressive Value Score of A. Value Score helps find stocks that are undervalued. Back-tested results have shown so far that stocks with a favorable Value Score in combination with a solid Zacks Rank are the best investment bets.
Robust Growth Prospects
The Zacks Consensus Estimate for HCA’s 2024 earnings is pegged at $20.49 per share, suggesting growth of 7.8% from the prior-year reported figure. The consensus mark for revenues is $69 billion, implying a rise of 6.2% from the year-ago reported number.
The consensus mark for 2025 earnings is pegged at $22.81 per share, indicating an improvement of 11.3% from the 2024 estimate. The same for revenues is $72.5 billion, hinting at a 5.1% increase from the 2024 estimate.
Decent Earnings Surprise History
HCA Healthcare’s bottom line outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 9.78%.
Solid Return on Equity
Return on equity in the trailing 12 months is significantly higher the industry’s average for HCA, which substantiates the company’s efficiency in utilizing shareholders’ funds.
A Strong View for 2024
HCA forecasts revenues within $67.8-$70.3 billion this year, the midpoint of which suggests 6.2% growth from the 2023 reported figure.
Earnings per share are anticipated between $19.70 and $21.20, the midpoint of which indicates an improvement of 7.6% from the 2023 level.
Key Business Tailwinds
The top line of HCA Healthcare is aided by improved patient volumes, which remain the most significant contributor to the revenues of any healthcare facility operator. Admissions grew 2.7% year over year in 2023.
The resumption of deferred elective procedures is expected to fetch a higher number of patients for the HCA’s surgery centers in the days ahead. Increase in elective surgeries implies improved inpatient occupancy levels, thereby boosting the revenues of HCA Healthcare. At the end of 2023, the company operated 124 freestanding surgery centers.
Growing outpatient surgeries and emergency room visits are likely to continue providing an impetus to the company’s top-line growth. The metrics rose 2.1% and 4.1%, respectively, on a year-over-year basis in 2023. HCA Healthcare also operates behavioral hospitals to address the growing incidence of mental health issues among Americans.
A series of acquisitions undertaken over the years have broadened HCA’s healthcare portfolio, diversified income streams and expanded the nationwide presence. It expended $635 million on purchases of hospitals and health care entities in 2023.
HCA Healthcare has an efficient virtual care services suite, which enables individuals to access care within the comfort of their homes. It has also taken the help of technology to standardize care for cell therapy programs.
A solid financial position is important for pursuing business investments. The financial strength of HCA Healthcare is substantiated by solid cash reserves and cash-generation abilities. As of Dec 31, 2023, its cash and cash equivalents improved 3% from the 2022-end level. Meanwhile HCA generated operating cash flows of $9.4 billion in 2023, up 10.7% year over year. A solid financial position also enables it to return value to shareholders via share buybacks and dividend payments. Management approved a 10% increase in the quarterly dividend in January 2024.
Medpace’s earnings surpassed estimates in each of the last four quarters, the average surprise being 12.42%. The Zacks Consensus Estimate for MEDP's 2024 earnings indicates a rise of 18.6% while the consensus mark for revenues suggests an improvement of 15.6% from the respective year-ago actuals. The consensus mark for MEDP’s 2024 earnings has moved 4.8% north in the past 60 days.
Lantheus’ earnings beat estimates in each of the trailing four quarters, the average surprise being 14.84%. The Zacks Consensus Estimate for LNTH’s 2024 earnings indicates a rise of 5.6% while the same for revenues suggests an improvement of 10.3% from the respective year-ago actuals. The consensus mark for LNTH’s 2024 earnings has moved 5.1% north in the past 60 days.
The bottom line of Organon outpaced estimates in two of the trailing four quarters and missed the mark twice, the average surprise being 5.06%. The Zacks Consensus Estimate for OGN’s 2024 earnings indicates a rise of 2.4%, while the consensus mark for revenues suggests an improvement of 1% from the respective year-ago actuals. The consensus mark for OGN’s 2024 earnings has moved 1% north in the past 60 days.
Shares of Medpace and Organon have gained 30.9% and 26.2%, respectively, year to date. However, the Lantheus stock has declined 3.5% in the same time frame.
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Why HCA Healthcare (HCA) is a Smart Addition to Your Portfolio
HCA Healthcare, Inc. (HCA - Free Report) is aided by growing surgery cases, acquisitions of healthcare facilities and solid operating cash flows. A positive business outlook for 2024 reinforces investors’ confidence in the stock.
Top Zacks Rank & Upbeat Price Performance
HCA Healthcare currently carries a Zacks Rank #2 (Buy).
The stock has gained 21.2% year to date compared with the industry’s 18.7% growth. The Zacks Medical sector has rallied 2.2% and the S&P 500 composite has risen 9.2% in the same time frame.
Image Source: Zacks Investment Research
Favorable Style Score
HCA Healthcare carries an impressive Value Score of A. Value Score helps find stocks that are undervalued. Back-tested results have shown so far that stocks with a favorable Value Score in combination with a solid Zacks Rank are the best investment bets.
Robust Growth Prospects
The Zacks Consensus Estimate for HCA’s 2024 earnings is pegged at $20.49 per share, suggesting growth of 7.8% from the prior-year reported figure. The consensus mark for revenues is $69 billion, implying a rise of 6.2% from the year-ago reported number.
The consensus mark for 2025 earnings is pegged at $22.81 per share, indicating an improvement of 11.3% from the 2024 estimate. The same for revenues is $72.5 billion, hinting at a 5.1% increase from the 2024 estimate.
Decent Earnings Surprise History
HCA Healthcare’s bottom line outpaced estimates in three of the trailing four quarters and missed the mark once, the average surprise being 9.78%.
Solid Return on Equity
Return on equity in the trailing 12 months is significantly higher the industry’s average for HCA, which substantiates the company’s efficiency in utilizing shareholders’ funds.
A Strong View for 2024
HCA forecasts revenues within $67.8-$70.3 billion this year, the midpoint of which suggests 6.2% growth from the 2023 reported figure.
Earnings per share are anticipated between $19.70 and $21.20, the midpoint of which indicates an improvement of 7.6% from the 2023 level.
Key Business Tailwinds
The top line of HCA Healthcare is aided by improved patient volumes, which remain the most significant contributor to the revenues of any healthcare facility operator. Admissions grew 2.7% year over year in 2023.
The resumption of deferred elective procedures is expected to fetch a higher number of patients for the HCA’s surgery centers in the days ahead. Increase in elective surgeries implies improved inpatient occupancy levels, thereby boosting the revenues of HCA Healthcare. At the end of 2023, the company operated 124 freestanding surgery centers.
Growing outpatient surgeries and emergency room visits are likely to continue providing an impetus to the company’s top-line growth. The metrics rose 2.1% and 4.1%, respectively, on a year-over-year basis in 2023. HCA Healthcare also operates behavioral hospitals to address the growing incidence of mental health issues among Americans.
A series of acquisitions undertaken over the years have broadened HCA’s healthcare portfolio, diversified income streams and expanded the nationwide presence. It expended $635 million on purchases of hospitals and health care entities in 2023.
HCA Healthcare has an efficient virtual care services suite, which enables individuals to access care within the comfort of their homes. It has also taken the help of technology to standardize care for cell therapy programs.
A solid financial position is important for pursuing business investments. The financial strength of HCA Healthcare is substantiated by solid cash reserves and cash-generation abilities. As of Dec 31, 2023, its cash and cash equivalents improved 3% from the 2022-end level. Meanwhile HCA generated operating cash flows of $9.4 billion in 2023, up 10.7% year over year. A solid financial position also enables it to return value to shareholders via share buybacks and dividend payments. Management approved a 10% increase in the quarterly dividend in January 2024.
Other Stocks to Consider
Some other top-ranked stocks in the Medical space are Medpace Holdings, Inc. (MEDP - Free Report) , Lantheus Holdings, Inc. (LNTH - Free Report) and Organon & Co. (OGN - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Medpace’s earnings surpassed estimates in each of the last four quarters, the average surprise being 12.42%. The Zacks Consensus Estimate for MEDP's 2024 earnings indicates a rise of 18.6% while the consensus mark for revenues suggests an improvement of 15.6% from the respective year-ago actuals. The consensus mark for MEDP’s 2024 earnings has moved 4.8% north in the past 60 days.
Lantheus’ earnings beat estimates in each of the trailing four quarters, the average surprise being 14.84%. The Zacks Consensus Estimate for LNTH’s 2024 earnings indicates a rise of 5.6% while the same for revenues suggests an improvement of 10.3% from the respective year-ago actuals. The consensus mark for LNTH’s 2024 earnings has moved 5.1% north in the past 60 days.
The bottom line of Organon outpaced estimates in two of the trailing four quarters and missed the mark twice, the average surprise being 5.06%. The Zacks Consensus Estimate for OGN’s 2024 earnings indicates a rise of 2.4%, while the consensus mark for revenues suggests an improvement of 1% from the respective year-ago actuals. The consensus mark for OGN’s 2024 earnings has moved 1% north in the past 60 days.
Shares of Medpace and Organon have gained 30.9% and 26.2%, respectively, year to date. However, the Lantheus stock has declined 3.5% in the same time frame.