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HCA Healthcare (HCA)
NYSE:HCA
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HCA Healthcare
(NYSE:HCA)65Neutral
Positive Factors
Financial Performance
HCA's strong balance sheet and cash flow continue to provide financial optionality going forward.
Investments
HCA announced an incremental $10 billion stock buyback and raised its quarterly cash dividend.
Negative Factors
Policy Uncertainty
There is continued unfavorable risk and reward perception due to policy and legislative uncertainty.
HCA Healthcare (HCA) vs. S&P 500 (SPY)
Market Cap
$76.07B
Dividend Yield0.85%
Average Volume (3M)1.83M
Price to Earnings (P/E)13.9
Beta (1Y)0.70
Revenue Growth8.67%
EPS Growth15.32%
CountryUS
Employees220,000
SectorHealthcare
Sector Strength74
IndustryHealthcare Providers & Services
Share Statistics
EPS (TTM)21.99
Shares Outstanding248,341,900
10 Day Avg. Volume1,917,939
30 Day Avg. Volume1,833,574
Financial Highlights & Ratios
PEG Ratio0.91
Price to Book (P/B)N/A
Price to Sales (P/S)1.08
Price to Cash Flow (P/CF)7.40
P/FCF Ratio6.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$373.13Price Target Upside19.57% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
HCA Healthcare Business Overview & Revenue Model
Company DescriptionHCA Healthcare (HCA) is one of the largest healthcare service providers in the United States. The company operates hospitals, freestanding surgery centers, urgent care facilities, and physician clinics across the country. HCA Healthcare focuses on delivering comprehensive medical care, including emergency services, inpatient and outpatient care, specialty treatments, and surgical procedures. With a commitment to patient-centered care, HCA Healthcare emphasizes the integration of advanced medical technology and skilled healthcare professionals to ensure high-quality health services.
How the Company Makes MoneyHCA Healthcare generates revenue primarily through patient services, making money from a diversified stream of healthcare operations. The company earns income by providing medical treatments, surgeries, diagnostic services, and other healthcare-related services to patients. A significant portion of its revenue comes from hospital inpatient care, outpatient services, and emergency room visits. HCA Healthcare also receives payments from insurance companies, government healthcare programs like Medicare and Medicaid, and directly from patients. Additionally, the company benefits from strategic partnerships with medical technology firms, pharmaceutical companies, and various healthcare providers, which help expand its service offerings and improve operational efficiency. These partnerships and collaborations enhance HCA's ability to deliver integrated healthcare solutions, thereby contributing to its financial growth.
HCA Healthcare Financial Statement Overview
Summary
HCA Healthcare demonstrates robust revenue growth and strong cash flow generation, which are positive indicators. However, the company faces significant challenges with declining profit margins and high leverage due to negative equity, highlighting financial risks.Income Statement
HCA Healthcare shows consistent revenue growth with a 8.66% increase from 2023 to 2024. However, the gross profit margin is notably lower in 2024, indicating rising costs or inefficiencies. The net profit margin has decreased significantly from previous years, reflecting challenges in maintaining profitability. The EBIT and EBITDA margins are healthy, but have also seen a decline compared to prior years.72
Positive
Balance Sheet
The company has a high debt-to-equity ratio due to negative stockholders' equity, indicating potential financial risk and reliance on debt. There is no equity cushion, which poses a risk in volatile market conditions. The return on equity is negative due to negative equity, masking the company's ability to generate returns for shareholders, despite positive net income.45
Neutral
Cash Flow
HCA Healthcare demonstrates strong operating cash flow, which has increased over the years, highlighting efficient cash generation from operations. The free cash flow has also grown, reflecting good control over capital expenditures. The operating cash flow to net income ratio is robust, suggesting solid cash flow generation relative to net income.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 70.60B | 64.97B | 60.23B | 58.75B | 51.53B | Gross Profit |
| 70.60B | 9.63B | 50.86B | 49.27B | 43.16B | EBIT |
| 3.95B | 9.63B | 9.10B | 9.79B | 7.32B | EBITDA |
| 13.86B | 12.72B | 13.29B | 14.25B | 9.73B | Net Income Common Stockholders |
| 5.76B | 5.24B | 5.64B | 6.96B | 3.75B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.93B | 1.02B | 908.00M | 1.45B | 1.79B | Total Assets |
| 59.51B | 56.21B | 52.44B | 50.74B | 47.49B | Total Debt |
| 45.24B | 41.86B | 39.84B | 36.33B | 32.68B | Net Debt |
| 43.30B | 40.92B | 38.93B | 34.88B | 30.88B | Total Liabilities |
| 58.96B | 55.15B | 52.51B | 49.25B | 44.60B | Stockholders Equity |
| -2.50B | -1.77B | -2.77B | -933.00M | 572.00M |
| Cash Flow | Free Cash Flow | |||
| 5.64B | 4.69B | 4.13B | 5.38B | 6.40B | Operating Cash Flow |
| 10.51B | 9.43B | 8.52B | 8.96B | 9.23B | Investing Cash Flow |
| -4.93B | -5.32B | -3.39B | -2.64B | -3.39B | Financing Cash Flow |
| -4.58B | -4.09B | -5.66B | -6.66B | -4.68B |
HCA Healthcare Technical Analysis
Negative
312.05
Price Trends
314.77
Negative
333.79
Negative
344.77
Negative
Market Momentum
-1.60
Positive
45.46
Neutral
37.96
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HCA, the sentiment is Negative. The current price of 312.05 is below the 20-day moving average (MA) of 320.45, below the 50-day MA of 314.77, and below the 200-day MA of 344.77, indicating a bearish trend. The MACD of -1.60 indicates Positive momentum. The RSI at 45.46 is Neutral, neither overbought nor oversold. The STOCH value of 37.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HCA.
HCA Healthcare Risk Analysis
HCA Healthcare disclosed 31 risk factors in its most recent earnings report. HCA Healthcare reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
HCA Healthcare Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $11.39B | 10.42 | 16.92% | 0.46% | 10.82% | 65.64% | |
72 Outperform | $12.04B | 3.86 | 76.72% | ― | 0.57% | 440.71% | |
67 Neutral | $32.62B | 27.08 | 7.37% | 1.31% | 10.70% | -49.85% | |
65 Neutral | $76.07B | 13.92 | -230.22% | 0.85% | 8.67% | 15.32% | |
52 Neutral | $418.16M | ― | 39.18% | ― | 1.16% | -278.41% | |
49 Neutral | $7.05B | 0.34 | -55.09% | 2.46% | 25.27% | -3.43% |
* Healthcare Sector Average
Performance Comparison
HCA
HCA Healthcare
312.05
-1.04
-0.33%
CYH
Community Health
3.03
0.19
6.69%
HUM
Humana
262.78
-71.36
-21.36%
THC
Tenet Healthcare
122.67
27.11
28.37%
UHS
Universal Health
173.30
-1.49
-0.85%
HCA Healthcare Earnings Call Summary
Earnings Call Date: Jan 24, 2025 | % Change Since: -4.09% | Next Earnings Date: Apr 18, 2025
Earnings Call Sentiment Positive
The earnings call demonstrated strong revenue and earnings growth despite external challenges such as hurricanes. Operational resilience and successful recovery efforts were highlighted, though certain areas like professional fees and outpatient surgery volumes posed challenges. Overall, the positives, such as strong cash flow and shareholder returns, outweighed the negatives.Highlights
Strong Earnings and Revenue Growth
Diluted earnings per share, as adjusted, increased 5.4% in the fourth quarter with revenue growth of approximately 6%. Full year revenue grew by 8.7%. Adjusted EBITDA increased 9% over the prior year.
Operational Resilience and Recovery
The company successfully remediated facilities impacted by hurricanes and resumed normal operations. Despite the hurricanes, adjusted EBITDA margin and cash flow from operations remained strong.
Positive Volume Trends
Inpatient admissions and equivalent admissions grew by 3%, with emergency room visits increasing by 2.4% and inpatient surgeries up by 2.8%.
Cash Flow and Shareholder Returns
Cash flow from operations was $10.5 billion for the year, an 11% increase. The company repurchased $6 billion of outstanding shares and paid $690 million in dividends for the year.
Lowlights
Impact of Hurricanes on Financials
The financial impact from hurricanes equated to approximately $0.60 per share in the quarter, with a $200 million adverse impact on the quarter's results.
Pressure from Professional Fees
Higher-than-expected professional fees continued into 2024, and pressures related to physician costs are expected to moderate only slightly in 2025.
Outpatient Surgery Volume Decline
Outpatient surgery cases were down 1.3%, mainly due to a decline in Medicaid and uninsured categories.
Company Guidance
During the HCA Healthcare Fourth Quarter 2024 Earnings Call, the guidance provided for 2025 highlighted several key financial metrics. The company projects revenues to range between $72.8 billion and $75.8 billion, with net income attributable to HCA Healthcare expected to be between $5.85 billion and $6.29 billion. Adjusted EBITDA is anticipated to range from $14.3 billion to $15.1 billion, and diluted earnings per share are forecasted to be between $24.05 and $25.85. HCA plans to allocate approximately $5 billion to $5.2 billion in capital spending. The guidance assumes equivalent admissions growth of 3% to 4%, with net revenue per equivalent admission increasing by 2% to 3%. The company also addressed the impact of hurricanes, indicating a neutral effect on 2025 EBITDA, and provided insights on Medicaid supplemental payment programs, projecting a potential $250 million headwind. Additionally, HCA announced a new $10 billion share repurchase program and an increase in its quarterly dividend from $0.66 to $0.72 per share.HCA Healthcare Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
HCA Healthcare Launches 2025 Executive Performance Program
Neutral
Feb 24, 2025
On February 18, 2025, HCA Healthcare’s Board of Directors adopted the 2025 Executive Officer Performance Excellence Program, which offers performance awards to executive officers based on EBITDA and quality metrics. The program aims to incentivize executives to meet specific financial and quality targets, with awards paid in cash. Additionally, Meg G. Crofton announced her retirement from the Board of Directors, effective April 24, 2025.
Private Placements and FinancingBusiness Operations and Strategy
HCA Healthcare Secures New Credit Arrangement
Neutral
Feb 20, 2025
On February 20, 2025, HCA Healthcare entered into a material definitive agreement involving a credit arrangement with Bank of America and other lenders. This development is likely to impact the company’s financial structuring and operations, potentially influencing its market positioning and stakeholder relations.
Stock BuybackDividendsFinancial Disclosures
HCA Healthcare Reports Strong Growth and Shareholder Initiatives
Positive
Jan 24, 2025
On January 24, 2025, HCA Healthcare announced its financial results for the fourth quarter and the full year ending December 31, 2024, demonstrating solid growth in revenue and net income despite challenges from Hurricanes Helene and Milton. The board also approved a $10 billion share repurchase program and declared a quarterly cash dividend, indicating strong financial health and commitment to shareholder value.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.