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Here's Why Community Health's Florida Divestiture Matters
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Community Health Systems, Inc. (CYH - Free Report) completed the sale of ShorePoint Health – Port Charlotte, certain assets of ShorePoint Health – Punta Gorda and some related businesses to AdventHealth in Florida for $260 million. This marks another step in CYH’s ongoing strategy to optimize its hospital portfolio and focus on core markets.
CYH initially announced the deal last November for $265 million, and its completion remains in line with the planned timeline. During the announcement of the deal, it said that the Punta Gorda hospital had indefinitely suspended inpatient operations due to damage from Hurricanes Helene and Milton. Offloading the facility is expected to remove uncertainty tied to restoration costs and revenue losses.
The sale is likely to provide CYH with additional capital that can be used for debt reduction, reinvestment, or operational improvements. CYH’s strategic asset sales indicate a shift toward streamlining operations and improving same-store metrics and profitability. As of Dec. 31, 2024, it had cash and cash equivalents worth only $37 million, while long-term debt amounted to $11.4 billion.
The company reported an adjusted loss of $1.03 per share in 2024 and expects the loss figure to be between 55 cents and breakeven in 2025. While it remains one of the major hospital operators in the United States, investors will be watching how effectively CYH reallocates capital from these sales and whether future divestitures will further strengthen its position.
Last November, Community Health’s $120 million planned sale of three Pennsylvania hospitals to WoodBridge Healthcare was terminated due to WoodBridge's inability to secure the funding.
CYH Price Performance
Community Health’s shares have gained 19% in the past year against the 4.9% decline of the industry it belongs to.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Community Health currently has a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for CareDx’s current-year earnings indicates a 1.8% year-over-year improvement. CDNA beat earnings estimates in each of the trailing four quarters, with an average surprise of 177.9%. The consensus mark for revenues implies 11.3% growth from the year-ago period.
The Zacks Consensus Estimate for Pediatrix Medical’s current-year earnings increased 4 cents in the past 30 days. MD beat earnings estimates in each of the trailing four quarters, with an average surprise of 19.4%. The consensus mark for its current-year revenues is pegged at $1.9 billion.
The Zacks Consensus Estimate for Addus HomeCare’s current-year earnings signals a 13.7% increase from the year-ago reported figure. ADUS beat earnings estimates in three of the trailing four quarters and met once, with an average surprise of 5.82%. The consensus mark for its current-year revenues is pegged at $1.4 billion, which indicates a 21.7% year-over-year growth.
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Here's Why Community Health's Florida Divestiture Matters
Community Health Systems, Inc. (CYH - Free Report) completed the sale of ShorePoint Health – Port Charlotte, certain assets of ShorePoint Health – Punta Gorda and some related businesses to AdventHealth in Florida for $260 million. This marks another step in CYH’s ongoing strategy to optimize its hospital portfolio and focus on core markets.
CYH initially announced the deal last November for $265 million, and its completion remains in line with the planned timeline. During the announcement of the deal, it said that the Punta Gorda hospital had indefinitely suspended inpatient operations due to damage from Hurricanes Helene and Milton. Offloading the facility is expected to remove uncertainty tied to restoration costs and revenue losses.
The sale is likely to provide CYH with additional capital that can be used for debt reduction, reinvestment, or operational improvements. CYH’s strategic asset sales indicate a shift toward streamlining operations and improving same-store metrics and profitability. As of Dec. 31, 2024, it had cash and cash equivalents worth only $37 million, while long-term debt amounted to $11.4 billion.
The company reported an adjusted loss of $1.03 per share in 2024 and expects the loss figure to be between 55 cents and breakeven in 2025. While it remains one of the major hospital operators in the United States, investors will be watching how effectively CYH reallocates capital from these sales and whether future divestitures will further strengthen its position.
Last November, Community Health’s $120 million planned sale of three Pennsylvania hospitals to WoodBridge Healthcare was terminated due to WoodBridge's inability to secure the funding.
CYH Price Performance
Community Health’s shares have gained 19% in the past year against the 4.9% decline of the industry it belongs to.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Community Health currently has a Zacks Rank #3 (Hold).
Some better-ranked and promising stocks in the broader Medical sector are CareDx, Inc. (CDNA - Free Report) , Pediatrix Medical Group, Inc. (MD - Free Report) and Addus HomeCare Corporation (ADUS - Free Report) . While CareDx currently sports a Zacks Rank #1 (Strong Buy), Pediatrix Medical and Addus HomeCare carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CareDx’s current-year earnings indicates a 1.8% year-over-year improvement. CDNA beat earnings estimates in each of the trailing four quarters, with an average surprise of 177.9%. The consensus mark for revenues implies 11.3% growth from the year-ago period.
The Zacks Consensus Estimate for Pediatrix Medical’s current-year earnings increased 4 cents in the past 30 days. MD beat earnings estimates in each of the trailing four quarters, with an average surprise of 19.4%. The consensus mark for its current-year revenues is pegged at $1.9 billion.
The Zacks Consensus Estimate for Addus HomeCare’s current-year earnings signals a 13.7% increase from the year-ago reported figure. ADUS beat earnings estimates in three of the trailing four quarters and met once, with an average surprise of 5.82%. The consensus mark for its current-year revenues is pegged at $1.4 billion, which indicates a 21.7% year-over-year growth.