Tenet Healthcare (THC) ended the recent trading session at $179.11, demonstrating a +2.55% change from the preceding day’s closing price. The stock outperformed the S&P 500, which registered a daily gain of 1.65%. Meanwhile, the Dow gained 0.92%, and the Nasdaq, a tech-heavy index, added 3.07%.
The hospital operator’s shares have seen a decrease of 11.19% over the last month, not keeping up with the Medical sector’s gain of 3.59% and the S&P 500’s gain of 0.48%.
Investors will be eagerly watching for the performance of Tenet Healthcare in its upcoming earnings disclosure. In that report, analysts expect Tenet Healthcare to post earnings of $4.08 per share. This would mark year-over-year growth of 1.49%. Alongside, our most recent consensus estimate is anticipating revenue of $5.39 billion, indicating a 2.27% upward movement from the same quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $17.61 per share and revenue of $22.02 billion. These totals would mark changes of +4.95% and +3.32%, respectively, from last year.
Investors should also take note of any recent adjustments to analyst estimates for Tenet Healthcare. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.67% upward. Tenet Healthcare presently features a Zacks Rank of #2 (Buy).
From a valuation perspective, Tenet Healthcare is currently exchanging hands at a Forward P/E ratio of 9.92. Its industry sports an average Forward P/E of 9.92, so one might conclude that Tenet Healthcare is trading at no noticeable deviation comparatively.
It’s also important to note that THC currently trades at a PEG ratio of 1.44. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Medical – Hospital stocks are, on average, holding a PEG ratio of 1.44 based on yesterday’s closing prices.
