The board of directors of HCA Holdings, Inc. (HCA - Free Report) recently authorized an additional share buyback program to return more value to its shareholders. The latest authorization will allow the company to utilize up to $2 billion to repurchase its common stock.
With the new authorization, the company now has $2.04 billion left under the buyback program as on Nov 14, 2016. The company had $0.04 million remaining from its earlier $3 billion repurchase authorization which was approved in Oct 2015. Notably, HCA Holdings bought back 29.1 million shares during the first nine months of 2016.
HCA Holdings’ financial strength allows it to execute share buybacks successfully. As of Sep 30, 2016, the company had cash and cash equivalents worth $677 million. Operating cash flow in the first nine months of 2016 was around $4 billion. Thus, a robust liquidity position enables the company to engage in share buybacks and boost shareholders’ value.
Share repurchases benefit the company’s earnings per share, book value as well as shareholder equity, as shares outstanding reduce. Therefore, share repurchase programs raise optimism among investors and boost their confidence on a stock. Also, the company’s strong capital position is reflected through its regular share repurchases.
Currently, HCA Holdings carries a Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked stocks from the medical sector include Baxter International Inc. (BAX - Free Report) , Cogentix Medical, Inc. (CGNT - Free Report) and Athersys, Inc. (ATHX - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Baxter International offers a portfolio of renal and hospital products. The company delivered positive surprises in all of the last four quarters with an average beat of 27.02%.
Cogentix Medical is a medical device company, engaged in designing, developing, manufacturing, and marketing of products for the urology market and flexible endoscopy. The company delivered positive surprises in two of the last four quarters with an average beat of 29.76%.
Athersys, Inc. is a biotechnology company which focuses on the research and development activities in the field of regenerative medicine. The company delivered positive surprises in all of the last four quarters with an average beat of 110.52%.
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