Wells upgrades Tenet after House passage of budget reconciliation legislation

As previously reported, Wells Fargo upgraded Tenet Healthcare (THC) to Overweight from Equal Weight with a price target of $195, up from $150. The firm is now more constructive on the hospital group and sees policy risks as having receded following the House passage of budget reconciliation legislation. While the legislation will face changes in the Senate and needs to be passed again by the House, Wells believes healthcare spending cuts are unlikely to worsen and could potentially moderate. Although the coverage impacts will be a headwind, the firm thinks they are likely to be manageable.