Update shared on08 Sep 2025
Fair value Increased 0.99%Tenet Healthcare’s consensus price target was revised slightly higher to $199.48, as strong Q2 earnings and positive hospital sector sentiment drove analyst optimism, though some caution remains around 2026 estimates and cost pressures.
Analyst Commentary
- Bullish analysts cite Tenet Healthcare's Q2 results exceeding expectations, leading to multiple price target increases.
- Strong earnings performance and positive hospital sector sentiment highlighted, with a physician survey indicating solid hospital earnings visibility.
- Some analysts view the stock's immediate post-earnings move as potentially "overdone" relative to fundamentals.
- Cautious commentary on future estimates due to uncertainty regarding 2026 outlook, including potential policy impacts and lack of management guidance on exchanges and subsidy expiration.
- While operational trends are strong, ongoing cost pressures in managed care are noted as a challenge, though not materially impacting hospital prospects at this stage.
What's in the News
- Senator Tom Cotton is introducing a bill requiring hospitals to publicly disclose policies regarding care for extremely premature infants; non-compliance would make hospitals ineligible for Medicaid funding. Publicly traded hospital operators affected include Tenet Healthcare (WSJ).
- Tenet Healthcare announced 2025 earnings guidance with projected net operating revenue between $20.95 billion and $21.25 billion, and net income available to stockholders between $1.279 billion and $1.379 billion, or diluted EPS of $14.05 to $15.15 (Key Developments).
- Between April 1 and July 22, 2025, Tenet repurchased 4.6 million shares, representing nearly 5% of outstanding shares, for $747 million; total repurchases under the ongoing plan have reached 8 million shares and $1.2 billion (Key Developments).
- Tenet Healthcare expanded its share repurchase program, increasing the buyback authorization by $1.5 billion to a total of $3 billion as of July 22, 2025 (Key Developments).
- The legislative focus on hospital disclosure for preemie care may lead to operational and regulatory impacts for Tenet Healthcare, notably regarding Medicaid eligibility (WSJ).
Valuation Changes
Summary of Valuation Changes for Tenet Healthcare
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $197.52 to $199.48.
- The Future P/E for Tenet Healthcare remained effectively unchanged, moving only marginally from 12.44x to 12.58x.
- The Discount Rate for Tenet Healthcare remained effectively unchanged, moving only marginally from 7.03% to 7.08%.
Disclaimer
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