On Tuesday, Bernstein SocGen Group adjusted its price target for HCA Healthcare Inc (NYSE: NYSE:HCA), increasing it to $342.00 from the previous $331.00, while keeping a Market Perform rating on the stock. The adjustment follows the announcement of HCA's fourth-quarter results for 2024, where the company reported an Adjusted EBITDA of $3,712 million, aligning with consensus estimates. HCA Healthcare's revenues met expectations at $18.3 billion. According to InvestingPro analysis, the company is currently trading slightly below its Fair Value, with a strong financial health score of 3.24 ("GREAT").
The healthcare provider experienced some setbacks during the quarter, including a significant $200 million earnings impact due to hurricanes. Same-store equivalent admission growth fell short of consensus predictions, showing an increase of 3.1% compared to the anticipated 5.5%. However, the rates rose by 2.2%, which was in line with forecasts. The compensation ratio was slightly better than expected at 43.3%, versus the consensus of 43.7%. Despite these challenges, InvestingPro data shows the company maintains robust revenue growth of 8.67% over the last twelve months.
HCA Healthcare's other operating expenses ratio was reported at 21.2%, slightly higher than consensus by 20 basis points. Similarly, the supplies ratio exceeded expectations by 20 basis points, coming in at 15.3%. Despite these challenges, the company's stock price has already reflected much of the risk, having declined over 23% since October 24, 2024. Year-to-date, the stock has shown resilience with a 10.61% return, demonstrating its market strength.
The analyst highlighted that while HCA Healthcare continues to demonstrate solid execution, there are increasing risks versus opportunities in the current environment. Key concerns for the company include policy risks related to Medicaid funding and supplemental payments, potential headwinds from slowing labor supply growth, and wage inflation impacting the compensation ratio. Nonetheless, HCA Healthcare's strong historical performance and strategic focus on labor supply strategies may provide it with a competitive edge in navigating these issues. InvestingPro subscribers can access additional insights through the comprehensive Pro Research Report, which includes detailed analysis of the company's financial health, valuation metrics, and growth prospects.
In other recent news, HCA Healthcare has been the subject of several analyst reports. Mizuho (NYSE:MFG) Securities maintained its Outperform rating on HCA Healthcare, setting a steady price target of $425. Despite HCA Healthcare's recent earnings report showing a slight miss in adjusted EBITDA, Mizuho analysts hold strong confidence in the company's performance, citing robust demand for its services and strong revenue growth.
TD Cowen also maintained a Buy rating, but reduced its price target from $440 to $377. This decision follows HCA Healthcare's fourth-quarter financial report, which demonstrated modest outperformance in revenue and EBITDA. Meanwhile, RBC Capital Markets reduced its price target to $384 but kept an Outperform rating, emphasizing the company's strong revenue growth.
Cantor Fitzgerald reiterated an Overweight rating on HCA shares, setting a price target of $405. The firm acknowledged potential challenges for the company in 2025 but expressed confidence in HCA's resilience and strong fundamentals. Leerink Partners adjusted their price target on HCA shares to $404, maintaining an Outperform rating, and highlighted the company's strong demand trends and effective cost control measures.
These recent developments underscore the evolving landscape for HCA Healthcare as it navigates the post-pandemic landscape and the ongoing demands of healthcare management.
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