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Community Health Systems (CYH) Beats Q2 Earnings Estimates

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Community Health Systems, Inc. (CYH - Free Report) reported adjusted earnings of 26 cents per share in the second quarter of 2017, which beat the Zacks Consensus Estimate by 4%.

Net loss attributable to the common stockholders was $137 million or $1.22 per diluted share, narrower than the net loss of $1.432 billion or $12.91 per share incurred in the year-ago quarter.

Quarterly Operational Update

In the second quarter, net operating revenue of $4.14 billion surpassed the Zacks Consensus Estimate by 2.5% but decreased 9.7% year over year. On a same-store basis, net operating revenue decreased 0.7% during the three months ended Jun 30, 2017, year over year.

The second quarter witnessed a 10.8% decrease in total admissions and an 11.2% fall in total adjusted admissions, year over year. On a same-store basis, both admissions and adjusted admissions decreased 2.5% from the year-ago quarter.

In the reported quarter, total operating expenses declined 32% to $4 billion, primarily due to lower salaries and benefits paid to employees, supplies, depreciation & amortization-related expenses and other operating costs.

Community Health Systems, Inc. Price, Consensus and EPS Surprise

Financial Update

As of Jun 30, 2017, the company’s total assets declined 5% from year-end 2016 to $20.8 billion. Cash and cash equivalents grew over 200% to $768 million from year-end 2016.

The company paid off a substantial portion of its debt through divestures. It had long-term debt of $14.7 billion as of Jun 30, 2017, down 0.6% year over year.

Total shareholders’ equity was $1.4 billion as of Jun 30, 2017, down 19.4% from year-end 2016.

Cash flow from operations was $503 million at the end of the second quarter, down 20.4% year over year.

2017 Guidance

Community Health expects net operating revenue (less provision for bad debts) in the range of $15.85 billion to $16.05 billion.

The company projects adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for 2017 in the range of $1.825–$2 billion.

Weighted-average diluted shares are expected in the band of $112–$113 million.

Zacks Rank and Performance of Other Insurers

Community Health presently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

Among the other firms in the medical sector that have reported second-quarter earnings so far, the bottom lines of Centene Corp. (CNC - Free Report) , Anthem Inc (ANTM - Free Report) and UnitedHealth Group Inc. (UNH - Free Report) beat their respective Zacks Consensus Estimate.

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