HCA Healthcare Price Estimates Raised On Strong Performance And Optimistic Outlook

Zinger Key Points
  • HCA Healthcare remains ahead of its peers while broader market trends normalize, one analyst said.
  • Admission trends were the key highlight of the quarter,” another analyst added.

Shares of HCA Healthcare Inc HCA continued to climb in early trading on Monday, after smashing earnings expectations and getting price targets bumped by analysts. Here are some key takeaways from additional analysts.

Oppenheimer On HCA Healthcare

Analyst Michael Wiederhorn maintained an Outperform rating and price target of $310.

HCA Healthcare reported “very strong” results for its first quarter and raises its increased guidance “conservatively,” Wiederhorn said in a note. “The company continues to stay ahead of the pack while broader trends normalize,” he added.

“While the impact of Medicaid re-determinations remains unclear, mgt doesn't expect significant downside and could see possible upside from mix improvements,” the analyst wrote. “Overall, we would continue to be long-term buyers of HCA, which remains the premier operator in the hospital space,” he further stated.

Mizuho Securities On HCA Healthcare

Analyst Ann Hynes reiterated a Buy rating and price target of $298.

HCA Healthcare’s first-quarter results met the high consensus estimates, with the spotlight being on admission trends, Hynes said. “Same store (s-s) admissions increased +4.4% y/y (compared to +2.9% y/y in Q4:22), while s-s adjusted admissions increased +7.5% y/y, (compared to +5.4% y/y in Q4:22), a key highlight of the quarter,” she added.

“Given the strong admission trends, particularly in inpatient and outpatient surgery volume, we expect HCA to provide an updated outlook on assumptions for the remainder of 2023,” the analyst wrote.

Check out other analyst stock ratings.

RBC Capital Markets On HCA Healthcare

Analyst Ben Hendrix reaffirmed an Outperform rating, while raising the price target from $283 to $315.

“HCA sets a solid tone for provider earnings, as late 2022 momentum continued through first quarter,” Hendrix wrote in a note. “Adjusted EBITDA came in just ahead of consensus (excluding a one-time benefit) on solid volume growth across all categories and continued labor improvement,” he added.

“We still believe recent MCO weakness is overdone, despite HCA's momentum,” the analyst further stated.

Credit Suisse On HCA Healthcare

Analyst AJ Rice maintained an Outperform rating, while raising the price target from $282 to $311.

“HCA said RM turnover was close to pre-pandemic levels and hiring increased almost 19% compared to the previous four quarters,” Rice said.

“Contract labor costs were down about 21% compared to last year Q1, a savings of around $140 mln,” the analyst wrote. “Contract labor expense is expected to decline further, primarily due to lower utilization as retention and hiring efforts continue improving,” he added.

HCA Price Action: Shares of HCA Healthcare had risen by 2.46% to $288.18 at the time of publishing Monday.

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Posted In: Analyst ColorEarningsNewsPrice TargetReiterationAnalyst RatingsMoversTrading IdeasAJ RiceAnn HynesBen HendrixCredit SuisseExpert IdeasMichael WiederhornMizuho SecuritiesOppenheimerRBC Capital Markets
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