Tenet Healthcare (THC) AI Stock Analysis

• Market Cap: $17.33B
• Dividend Yield: N/A
• Average Volume (3M): 1.07M
• Price to Earnings (P/E): 12.6
• Beta (1Y): 1.08
• Revenue Growth: -1.09%
• EPS Growth: -43.10%
• Country: US
• Employees: 98,000
• Sector: Healthcare
• Sector Strength: 52
• Industry: Medical - Care Facilities
• EPS (TTM): 4.02
• Shares Outstanding: 88,351,000
• 10 Day Avg. Volume: 943,970
• 30 Day Avg. Volume: 1,073,795
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.80
• Enterprise Value/Revenue: 1.51
• Enterprise Value/Gross Profit: 2.95
• Enterprise Value/Ebitda: 6.77
• 1Y Price Target: $206.07
• Price Target Upside: 5.04% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 17

• Rating: 75 Outperform
• Price Target: $193.00 ▼(-1.62% Downside)

Tenet Healthcare's strong earnings call and attractive valuation are the most significant factors driving the score. The company's financial performance shows stability but is pressured by high leverage and decreased profitability. Technical indicators suggest positive momentum, though caution is warranted due to potential overbought conditions. The strategic appointment of a new COO adds a positive outlook for operational leadership.

Positive Factors

Business Growth

Tenet Healthcare Corp. opened 8 new centers focused on high acuity, which positions the company well to benefit from changes in Medicare policies.

Earnings

The guidance was increased $395m at the midpoint which is higher than expected.

Shareholder Value

THC has bought back $1.1b of stock and announced another $1.5b authorization, combined 16% of the market cap.

Negative Factors

Exchange Market Volatility

Some volatility in the exchange marketplace is possible even with approval.

Legislative Risks

Investor angst likely increases operating bar due to legislative headwinds.

Subsidy Risks

A headwind of $265 million is expected in the acute segment due to potential subsidy losses in 2026.

Tenet Healthcare Business Overview & Revenue Model

Company Description

Tenet Healthcare Corporation operates as a diversified healthcare services company. The company operates in three segments: Hospital Operations and Other, Ambulatory Care, and Conifer. Its general hospitals offer acute care services, operating and recovery rooms, radiology and respiratory therapy services, clinical laboratories, and pharmacies. The company also provides intensive and critical care, and coronary care units; cardiovascular, digestive disease, neurosciences, musculoskeletal, and obstetrics services; outpatient services, including physical therapy; cardiothoracic surgery, complex spinal surgery, neonatal intensive care, and neurosurgery services; quaternary care services in heart and kidney transplants; and limb-salvaging vascular procedure, acute level 1 trauma, intravascular stroke care, minimally invasive cardiac valve replacement, imaging, and telemedicine access services. In addition, it operates ambulatory surgery and urgent care centers, imaging centers, surgical hospitals, off-campus emergency departments, and micro-hospitals; and offers healthcare business process services in the areas of hospital and physician revenue cycle management, patient communications and engagement support, and value-based care solutions to hospitals, health systems, physician practices, employers, and other customers. As of February 09, 2022, the company operated 60 hospitals; and approximately 550 other healthcare facilities, including surgical hospitals, ambulatory surgery centers, urgent care and imaging centers, and other care sites and clinics. Tenet Healthcare Corporation was incorporated in 1975 and is headquartered in Dallas, Texas.

How the Company Makes Money

Tenet Healthcare generates revenue primarily through the provision of healthcare services, which includes patient care services in its hospitals, surgical centers, and outpatient facilities. The company earns money from patient admissions, surgeries, diagnostic tests, and ancillary services, billed primarily through third-party payers such as Medicare, Medicaid, and private insurance companies. Key revenue streams include inpatient and outpatient services, which account for a significant portion of their earnings. Additionally, Tenet has partnerships with various healthcare organizations and payers that contribute to its revenue, as well as investments in value-based care initiatives that align reimbursement with patient outcomes. The company's ability to manage operational efficiency and cost structures also plays a crucial role in its overall profitability.

Tenet Healthcare Financial Statement Overview

Summary

Tenet Healthcare shows stable revenue and strong returns on equity, but profitability has decreased, and high leverage poses financial risk. Cash flow generation is robust, but improving margins and managing debt are crucial.

Income Statement

Tenet Healthcare shows a stable revenue stream with a slight increase from $20.65B to $20.69B TTM. Gross profit margins are healthy at approximately 47.81% for TTM. The net profit margin, however, has decreased to 7.17% from the previous annual figure of 15.49%, indicating a significant drop in profitability. EBIT and EBITDA margins have also decreased, reflecting operational challenges.

Balance Sheet

The company maintains a high debt-to-equity ratio of 3.51 in TTM, which indicates a significant reliance on leverage. The equity ratio is low at around 13.06%, suggesting potential financial risk if not managed effectively. However, return on equity is strong at 39.59%, indicating effective utilization of equity to generate profits.

Cash Flow

Free cash flow has grown from $1.12B to $1.56B, an increase of 39.64%, highlighting improved cash generation. The operating cash flow to net income ratio of 1.66 indicates solid cash generation relative to accounting profits. However, the free cash flow to net income ratio of 1.05 shows slightly lower cash conversion efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	20.69B	20.66B	20.55B	19.17B	19.48B	17.64B
Gross Profit	10.60B	8.21B	7.80B	7.05B	7.27B	6.23B
EBITDA	4.62B	6.89B	3.39B	3.08B	3.67B	2.53B
Net Income	1.48B	3.20B	611.00M	411.00M	914.00M	399.00M
Balance Sheet
Total Assets	28.70B	28.94B	28.31B	27.16B	27.58B	27.11B
Cash, Cash Equivalents and Short-Term Investments	2.63B	3.02B	1.23B	858.00M	2.36B	2.45B
Total Debt	13.18B	13.17B	15.00B	15.08B	15.65B	15.72B
Total Liabilities	20.40B	20.39B	22.80B	22.55B	23.32B	24.22B
Stockholders Equity	3.75B	4.17B	1.61B	1.14B	1.03B	28.00M
Cash Flow
Free Cash Flow	1.56B	1.12B	1.62B	321.00M	910.00M	2.87B
Operating Cash Flow	2.46B	2.05B	2.37B	1.08B	1.57B	3.41B
Investing Cash Flow	-267.00M	3.25B	-969.00M	-808.00M	-714.00M	-1.61B
Financing Cash Flow	-2.45B	-3.51B	-1.03B	-1.78B	-936.00M	385.00M

Tenet Healthcare Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 196.18
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For THC, the sentiment is Positive. The current price of 196.18 is above the 20-day moving average (MA) of 178.96, above the 50-day MA of 171.80, and above the 200-day MA of 147.96, indicating a bullish trend. The MACD of 6.43 indicates Negative momentum. The RSI at 78.20 is Negative, neither overbought nor oversold. The STOCH value of 96.58 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for THC.

Tenet Healthcare Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UHS	78 Outperform	$12.10B	10.01	18.66%	0.42%	9.61%	39.65%
THC	75 Outperform	$17.33B	12.56	41.09%	―	-1.09%	-43.10%
EHC	73 Outperform	$12.65B	24.55	25.35%	0.54%	11.80%	30.02%
FMS	71 Outperform	$14.43B	20.18	4.72%	3.18%	1.11%	25.84%
HCA	71 Outperform	$98.46B	17.67	-230.22%	0.66%	6.37%	11.25%
DVA	62 Neutral	$9.86B	13.55	635.30%	―	5.09%	7.85%
Sector *	51 Neutral	$7.95B	-0.40	-42.50%	2.21%	22.29%	-1.85%

Tenet Healthcare Corporate Events

Tenet Healthcare Appoints Lisa Y. Foo as COO

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.