Ardent Health Partners, Inc., the Healthcare sector company, was revisited by a Wall Street analyst yesterday. Analyst Kevin Fischbeck from Bank of America Securities reiterated a Sell rating on the stock and has a $12.00 price target.
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Kevin Fischbeck has given his Sell rating due to a combination of factors impacting Ardent Health Partners, Inc. One of the primary concerns is the anticipated impact of the State Directed Payment (SDP) cuts, which are expected to be significantly higher than initially estimated. The company’s management anticipates these cuts to result in a financial impact between $150 million and $175 million by 2035, which is 25% above the previous estimate. Although there are some mitigating factors, such as rural hospital funds, the overall financial outlook remains challenging.
Additionally, while the company has seen growth in exchange volumes, this has not translated into substantial profitability. The rates in these exchanges are closer to Medicare levels, which are less favorable, and the company has already begun exiting some plans with poor rates. Furthermore, Ardent Health Partners is experiencing higher payer denials, which have been increasing since the second quarter of 2024, adding to the financial pressures. These factors, combined with the ongoing challenges from Medicaid cuts and exchange profitability issues, underpin Fischbeck’s Sell rating.
According to TipRanks, Fischbeck is a 4-star analyst with an average return of 3.4% and a 60.13% success rate. Fischbeck covers the Healthcare sector, focusing on stocks such as Cigna, Centene, and HCA Healthcare.