tiprankstipranks
Trending News
More News >
Tenet Healthcare (THC)
NYSE:THC
Advertisement

Tenet Healthcare (THC) AI Stock Analysis

Compare
892 Followers

Top Page

THC

Tenet Healthcare

(NYSE:THC)

Rating:67Neutral
Price Target:
$161.00
▲(8.51%Upside)
The overall score reflects strong earnings call results and undervaluation, offset by bearish technical indicators and financial risks from high leverage and declining profitability. Positive corporate events provide a minor boost.
Positive Factors
Business Strategy
Analyst recommends buying the stock due to strong free cash flow and a shift towards faster-growing business segments.
Revenue Growth
Exchange admissions increased significantly, reflecting a growth in exchange revenues.
Stock Buyback
THC has bought back $1.1 billion of stock and announced another $1.5 billion authorization, which combined represents 16% of the market cap.
Negative Factors
Future Uncertainty
Uncertainty around the path forward for exchanges, which account for 7% of revenue, creates some concern regarding future performance.
Potential Future Losses
A headwind of $265 million is expected in the acute segment due to potential subsidy losses in 2026.

Tenet Healthcare (THC) vs. SPDR S&P 500 ETF (SPY)

Tenet Healthcare Business Overview & Revenue Model

Company DescriptionTenet Healthcare Corporation is a diversified healthcare services company headquartered in Dallas, Texas. It operates through a network of hospitals, outpatient centers, and urgent care facilities across the United States. The company offers a broad range of healthcare services, including acute care, specialty surgery, diagnostic imaging, and other outpatient services, catering to a wide array of medical needs. With a focus on quality care and patient satisfaction, Tenet Healthcare is dedicated to improving healthcare delivery through its various subsidiaries, including Conifer Health Solutions and United Surgical Partners International (USPI).
How the Company Makes MoneyTenet Healthcare generates revenue primarily through patient services provided at its hospitals, outpatient centers, and urgent care facilities. The company earns money from patient admissions, surgeries, diagnostic services, and other medical procedures. A significant portion of its revenue comes from agreements with private insurance companies, government health programs like Medicare and Medicaid, and direct payments from patients. Additionally, Tenet's subsidiary, United Surgical Partners International, contributes to its earnings by operating surgical facilities in partnership with physicians. Conifer Health Solutions, another key subsidiary, provides revenue cycle management and value-based care services, further enhancing the company's financial performance. Strategic partnerships and acquisitions also play a crucial role in expanding Tenet's service offerings and market presence, driving revenue growth.

Tenet Healthcare Key Performance Indicators (KPIs)

Any
Any
Total Hospitals
Total Hospitals
Indicates the number of hospitals operated, reflecting the scale of operations and market presence. A larger network can drive higher revenue and provide competitive advantages in negotiating with insurers and suppliers.
Chart InsightsTenet Healthcare's total number of hospitals has decreased significantly since 2020, with a notable drop in 2024. Despite this reduction, the company has reported strong financial performance in early 2025, with robust revenue and EBITDA growth. The strategic focus on ambulatory space M&A and operational excellence is likely compensating for the reduced hospital count. However, uncertainties in healthcare policy, particularly around Medicaid, could pose challenges. The company's cautious approach to 2025 guidance reflects these uncertainties, despite a promising start to the fiscal year.
Data provided by:Main Street Data

Tenet Healthcare Earnings Call Summary

Earnings Call Date:Jul 22, 2025
(Q2-2025)
|
% Change Since: -15.04%|
Next Earnings Date:Oct 16, 2025
Earnings Call Sentiment Positive
The earnings call showcased strong financial performance with significant revenue and EBITDA growth, particularly in the USPI and hospital segments. The expansion of the share repurchase program and raised full-year guidance further underscore the company's robust financial health. However, a slight reduction in volume guidance and a decrease in USPI case volumes were noted as potential areas of concern. Despite these issues, the positive aspects significantly outweigh the negatives.
Q2-2025 Updates
Positive Updates
Strong Revenue and EBITDA Growth
Net operating revenues for Q2 2025 were $5.3 billion with a consolidated adjusted EBITDA of $1.121 billion, representing a 19% growth over Q2 2024. Adjusted EBITDA margin improved by 280 basis points to 21.3%.
USPI Performance
USPI's adjusted EBITDA grew 11% year-over-year with a margin of 39.2%. Same facility revenues increased by 7.7% with a 12.6% growth in total joint replacements in ASCs.
Hospital Segment Growth
Adjusted EBITDA for the hospital segment grew 25% to $623 million in Q2 2025, with margins up 300 basis points to 15.6%. Same hospital inpatient admissions increased by 1.6%.
Share Repurchase Program Expansion
$1.1 billion was deployed to repurchase 7.2 million shares in H1 2025. The board authorized an additional $1.5 billion increase to the share repurchase program.
Increased Full-Year Guidance
Full-year 2025 adjusted EBITDA guidance was raised by $395 million to a range of $4.4 to $4.54 billion, reflecting a 12% growth over 2024.
Negative Updates
Volume Guidance Reduction
Guidance for same hospital admissions growth was lowered by 50 basis points to a range of 1.5% to 2.5% for 2025, indicating a slight deceleration in expected volume growth.
USPI Case Volume Decline
USPI case volumes decreased by 0.6%, reflecting a shift towards higher acuity services which may reduce overall case volume.
Company Guidance
In the second quarter of 2025, Tenet Healthcare Corporation reported robust financial performance with net operating revenues reaching $5.3 billion and a consolidated adjusted EBITDA of $1.121 billion, marking a 19% increase over the previous year. The adjusted EBITDA margin improved by 280 basis points to 21.3%, driven by efficient operations and strong same-store growth. USPI, a key segment, posted an 11% increase in adjusted EBITDA to $498 million, supported by a 7.7% rise in same facility revenues. The hospital segment also showed strength, with adjusted EBITDA increasing by 25% to $623 million, aided by a 1.6% rise in same-store admissions and a 5.2% rise in revenue per adjusted admission. Looking forward, Tenet raised its full-year 2025 adjusted EBITDA guidance to a range of $4.4 to $4.54 billion, reflecting a $395 million increase at the midpoint, attributed to fundamental business strength and anticipated growth. Additionally, their cash flow generation remains strong, with $743 million of free cash flow in the second quarter and cash on hand totaling $2.6 billion as of June 30, 2025. The board has authorized a $1.5 billion increase in the share repurchase program, underscoring confidence in continued financial flexibility and shareholder value creation.

Tenet Healthcare Financial Statement Overview

Summary
Tenet Healthcare displays strong operational efficiency and cash flow management, with impressive profitability metrics and a significantly improved debt position. However, challenges include a recent decline in net income and revenue growth, as well as a relatively high liability level.
Income Statement
76
Positive
Tenet Healthcare shows strong profitability with a consistent gross profit margin of around 47.3% TTM. The net profit margin has seen fluctuations but stands at a healthy 8.1% TTM. Revenue growth is stable with a slight decrease in the latest TTM compared to the previous year. The company maintains robust EBIT and EBITDA margins at 17.2% and 18.3% respectively, indicating efficient operations. However, the recent decline in net income and revenue growth could pose concerns if not addressed.
Balance Sheet
68
Positive
The company's balance sheet reveals a solid equity ratio of 14.3% TTM, showing a reasonable level of financial stability. The debt-to-equity ratio has improved significantly, dropping to 0.02, reflecting effective debt management. Return on equity is impressive at 40%, indicating strong profitability relative to shareholder equity. However, the overall equity base remains relatively small compared to total liabilities, which could pose risks during financial downturns.
Cash Flow
72
Positive
Cash flow analysis indicates a strong free cash flow growth rate of 27.4% TTM, highlighting improved cash generation capabilities. The operating cash flow to net income ratio is robust at 1.36, demonstrating efficient cash flow management. The free cash flow to net income ratio is also solid at 0.85, suggesting effective use of cash. Despite this, the company must maintain its focus on sustaining cash flow growth amid fluctuating net income levels.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue20.66B20.55B19.17B19.48B17.64B
Gross Profit11.86B16.96B15.90B16.16B14.66B
EBITDA6.89B3.39B3.33B3.42B2.43B
Net Income3.20B611.00M1.00B1.48B768.00M
Balance Sheet
Total Assets28.94B28.31B27.16B27.58B27.11B
Cash, Cash Equivalents and Short-Term Investments3.02B1.23B858.00M2.36B2.45B
Total Debt14.33B16.21B15.08B15.65B15.72B
Total Liabilities20.39B22.80B22.55B23.32B24.22B
Stockholders Equity4.17B1.61B1.14B1.03B28.00M
Cash Flow
Free Cash Flow1.12B1.62B321.00M910.00M2.87B
Operating Cash Flow2.05B2.37B1.08B1.57B3.41B
Investing Cash Flow3.43B-969.00M-808.00M-714.00M-1.61B
Financing Cash Flow-3.69B-1.03B-1.78B-936.00M385.00M

Tenet Healthcare Technical Analysis

Technical Analysis Sentiment
Negative
Last Price148.38
Price Trends
50DMA
167.94
Negative
100DMA
149.28
Positive
200DMA
145.82
Positive
Market Momentum
MACD
-2.73
Positive
RSI
35.48
Neutral
STOCH
10.73
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For THC, the sentiment is Negative. The current price of 148.38 is below the 20-day moving average (MA) of 170.08, below the 50-day MA of 167.94, and above the 200-day MA of 145.82, indicating a neutral trend. The MACD of -2.73 indicates Positive momentum. The RSI at 35.48 is Neutral, neither overbought nor oversold. The STOCH value of 10.73 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for THC.

Tenet Healthcare Risk Analysis

Tenet Healthcare disclosed 25 risk factors in its most recent earnings report. Tenet Healthcare reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Tenet Healthcare Peers Comparison

Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
$15.78B23.584.36%0.10%-0.91%27.17%
73
Outperform
$10.02B9.2618.35%0.51%9.73%51.87%
70
Outperform
$10.93B14.33260.92%5.11%14.28%
69
Neutral
$82.15B15.70-230.22%0.83%6.37%
67
Neutral
$13.78B9.5041.09%-1.09%-43.10%
65
Neutral
$10.96B22.4525.33%0.63%11.21%30.38%
52
Neutral
$7.60B0.11-62.95%2.07%16.16%0.31%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
THC
Tenet Healthcare
153.02
1.39
0.92%
DVA
DaVita
145.17
7.76
5.65%
FMS
Fresenius Medical Care
26.43
6.52
32.75%
HCA
HCA Healthcare
334.32
-17.64
-5.01%
EHC
Encompass Health
107.67
16.67
18.32%
UHS
Universal Health
155.60
-57.23
-26.89%

Tenet Healthcare Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
Tenet Healthcare Appoints Lisa Y. Foo as COO
Positive
Jun 5, 2025

On May 30, 2025, Tenet Healthcare Corporation announced the promotion of Lisa Y. Foo to the newly created position of Chief Operating Officer, effective immediately. This strategic move is expected to enhance the company’s operational leadership and potentially strengthen its market position.

The most recent analyst rating on (THC) stock is a Buy with a $136.00 price target. To see the full list of analyst forecasts on Tenet Healthcare stock, see the THC Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Tenet Healthcare Holds Annual Shareholder Meeting
Neutral
May 27, 2025

On May 22, 2025, Tenet Healthcare Corporation held its Annual Meeting of Shareholders, where several key decisions were made. Shareholders elected directors to the board, approved executive compensation, and ratified Deloitte & Touche LLP as the independent accountants for 2025. However, a proposal for a report on improving maternal health outcomes was not approved, indicating a lack of consensus on this issue among shareholders.

The most recent analyst rating on (THC) stock is a Buy with a $184.00 price target. To see the full list of analyst forecasts on Tenet Healthcare stock, see the THC Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jul 25, 2025