Update shared on21 Sep 2025
Fair value Increased 1.31%HCA Healthcare’s consensus price target has risen as analysts factor in positive impacts from newly approved Texas payments and strong margins despite softening volumes, reflecting management’s resilience in adapting to policy challenges, with fair value increasing from $398.57 to $403.81.
Analyst Commentary
- Incorporation of preliminary estimates for newly approved state-directed payments in Texas driving upward revisions in price targets.
- Solid underlying hospital fundamentals expected to persist in the near term despite concerns over an increasingly negative policy and reimbursement environment.
- Outperformance on margins in the latest quarter, although overall patient volumes have decelerated.
- Risks cited to future margins due to potential headwinds from labor cost ratios, policy changes, and increases in bad debt.
- Increased confidence in HCA's ability to adapt to healthcare policy shifts through resiliency efforts, particularly addressing challenges posed by new Medicaid provisions.
What's in the News
- A new bill introduced by Senator Tom Cotton could require hospitals—including HCA Healthcare—to disclose their policies on caring for extremely premature infants or risk losing Medicaid funding; the proposal follows a Wall Street Journal investigation highlighting disparities in care (WSJ).
- HCA Healthcare revised its full-year 2025 guidance upward, now projecting revenues of $74.0–$76.0 billion (up from $72.8–$75.8 billion) and diluted GAAP EPS of $25.50–$27.00 (up from $24.05–$25.85) (Key Developments).
- Net income guidance for 2025 was also raised to $6.11–$6.48 billion, up from the prior outlook of $5.85–$6.29 billion (Key Developments).
- From April 1 to June 30, 2025, HCA repurchased 7.03 million shares (2.89% of outstanding) for $2.51 billion, completing a total buyback of 12.42 million shares (5.05%) for $4.25 billion under the January 2025 program (Key Developments).
- HCA Healthcare was added to the Russell 1000 Value-Defensive, Growth-Defensive, and Defensive Indexes as of June 28, 2025, signaling recognition as a defensive stock in both value and growth categories (Key Developments).
Valuation Changes
Summary of Valuation Changes for HCA Healthcare
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $398.57 to $403.81.
- The Future P/E for HCA Healthcare remained effectively unchanged, moving only marginally from 13.23x to 13.39x.
- The Net Profit Margin for HCA Healthcare remained effectively unchanged, moving only marginally from 8.07% to 8.08%.
Disclaimer
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