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Tenet Healthcare (THC) Registers a Bigger Fall Than the Market: Important Facts to Note

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In the latest trading session, Tenet Healthcare (THC - Free Report) closed at $182.82, marking a -2.1% move from the previous day. The stock's change was less than the S&P 500's daily loss of 0.13%. Meanwhile, the Dow experienced a drop of 0.27%, and the technology-dominated Nasdaq saw a decrease of 0.07%.

The stock of hospital operator has risen by 9% in the past month, leading the Medical sector's gain of 0.73% and the S&P 500's gain of 2.71%.

The upcoming earnings release of Tenet Healthcare will be of great interest to investors. The company is predicted to post an EPS of $3.35, indicating a 14.33% growth compared to the equivalent quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $5.25 billion, up 2.42% from the prior-year quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $15.54 per share and revenue of $21.15 billion, indicating changes of +30.81% and +2.36%, respectively, compared to the previous year.

Investors should also note any recent changes to analyst estimates for Tenet Healthcare. These recent revisions tend to reflect the evolving nature of short-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. As of now, Tenet Healthcare holds a Zacks Rank of #1 (Strong Buy).

Valuation is also important, so investors should note that Tenet Healthcare has a Forward P/E ratio of 12.02 right now. For comparison, its industry has an average Forward P/E of 10.69, which means Tenet Healthcare is trading at a premium to the group.

One should further note that THC currently holds a PEG ratio of 0.81. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. Medical - Hospital stocks are, on average, holding a PEG ratio of 1.05 based on yesterday's closing prices.

The Medical - Hospital industry is part of the Medical sector. With its current Zacks Industry Rank of 28, this industry ranks in the top 12% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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