UPDATE: BMO Capital Markets Downgrades Community Health Systems to Underperform on
BMO Capital Markets downgraded Community Health Systems (NYSE: CYH) from Market Perform to Underperform and announced a $35.00 price target.
BMO Capital Markets said, "We are downgrading shares of CYH to Underperform from Market Perform, as we believe the current valuation has more downside risk than competitors. Shares of CYH have appreciated ~30% YTD as the Street warmed to the idea of Obamacare upside in 2014. Reduced bad debt levels will undoubtedly aid operations for the acute care hospital space. However, with so many variables in play in 2014 we believe the recent move in valuation is premature. Medicare Advantage preliminary rates for managed care carriers are due for release this week and the sequestration deadline is inching closer. We believe these events could reignite investor concerns around government reimbursement and the real macro pressures affecting the space."
Community Health Systems closed at $40.16 on Friday.
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