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HCA Healthcare (HCA) Gains 29% in a Year: More Upside Left?

Shares of HCA Healthcare, Inc. HCA have rallied 28.5% in a year, compared with the industry’s 17.6% increase. The Medical sector declined 7.8% but the S&P 500 composite index gained 1.3% in the same time frame. With a market capitalization of $77.6 billion, the average volume of shares traded in the last three months was 1.3 million.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Rising patient volumes, acquisitions of hospitals or healthcare entities and a sound financial position continue to drive HCA Healthcare.

The leading U.S. healthcare services provider, presently carrying a Zacks Rank #3 (Hold), has a decent track record of beating estimates in three of the trailing four quarters and missing the same once, the average beat being 9.04%.

Can HCA Retain the Momentum?

The Zacks Consensus Estimate for HCA Healthcare’s 2023 earnings is pegged at $18.09 per share, indicating a 7.1% increase from the 2022 reported figure. The same for revenues stands at $63.4 billion, suggesting a 5.3% increase from the year-ago figure. It has witnessed eight upward estimate revisions compared to none for 2023 earnings over the past 30 days.

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Growing patient volumes, the most significant contributor to a hospital stock’s top line, contribute to the revenue growth of HCA Healthcare. The efficient telehealth services of HCA also provide an impetus to its top line, considering the ongoing digitization across every sphere of life and the amount of ease and convenience that such services provide.

An array of buyouts undertaken over the years continue to add hospitals and other medical facilities to the portfolio of HCA Healthcare. Simultaneously, growth-related initiatives have also diversified HCA’s income streams and bolstered its nationwide presence. As of Mar 31, 2023, its healthcare portfolio comprises 180 hospitals and roughly 2,300 ambulatory sites of care stretched across 20 states and the United Kingdom.

The healthcare services provider does not shy away from selling unprofitable businesses in a bid to intensify focus on high-growth areas and boost profits.

The cash reserves and adequate cash-generating abilities enable HCA Healthcare to undertake significant growth-related efforts and engage in the tactical deployment of capital through share buybacks and dividend payments. In January 2023, management sanctioned a new $3-billion share buyback plan and even hiked its quarterly dividend by 7.1%. Its dividend yield of 0.9% remains higher than the industry’s figure of 0.8%.

HCA Healthcare boasts an impressive VGM Score of A. VGM Score helps identify stocks with the most attractive value, the best growth and the most promising momentum.

Stocks to Consider

Some better-ranked stocks in the Medical space are ANI Pharmaceuticals, Inc. ANIP, Addus HomeCare Corporation ADUS and Boston Scientific Corporation BSX. While ANI Pharmaceuticals currently sports a Zacks Rank #1 (Strong Buy), Addus HomeCare and Boston Scientific carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

ANI Pharmaceuticals’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average beat being 68.64%. The Zacks Consensus Estimate for ANIP’s 2023 earnings suggests a surge of 91.9%, while the same for revenues indicates growth of 27.1% from the respective year-ago reported figures.

The consensus estimate for ANIP’s 2023 earnings has moved 7.9% north in the past seven days. Shares of ANI Pharmaceuticals have gained 37.5% in the past year.

Addus HomeCare’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average being 6.10%. The Zacks Consensus Estimate for ADUS’s 2023 earnings indicates a rise of 9.4%, while the same for revenues suggests an improvement of 8.3% from the corresponding year-ago reported estimates.

The consensus estimate for ADUS’s 2023 earnings has moved 0.5% north in the past 30 days. Shares of Addus HomeCare have gained 3.3% in a year.

Boston Scientific’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and missed the mark twice, the average being 1.88%. The Zacks Consensus Estimate for BSX’s 2023 earnings suggests an improvement of 14%, while the same for revenues indicates growth of 9.5% from the respective year-ago reported figures.

The Zacks Consensus Estimate for BSX’s 2023 earnings has moved 2.6% north in the past 30 days. Shares of Boston Scientific have rallied 29.9% in the past year.

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Boston Scientific Corporation (BSX) : Free Stock Analysis Report

HCA Healthcare, Inc. (HCA) : Free Stock Analysis Report

Addus HomeCare Corporation (ADUS) : Free Stock Analysis Report

ANI Pharmaceuticals, Inc. (ANIP) : Free Stock Analysis Report

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Zacks Investment Research