The Community Health Systems, Inc. (NYSE:CYH) Third-Quarter Results Are Out And Analysts Have Published New Forecasts

One of the biggest stories of last week was how Community Health Systems, Inc. (NYSE:CYH) shares plunged 33% in the week since its latest third-quarter results, closing yesterday at US$3.99. It was a pretty bad result overall; while revenues were in line with expectations at US$3.1b, statutory losses exploded to US$2.95 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Community Health Systems after the latest results.

See our latest analysis for Community Health Systems

Taking into account the latest results, Community Health Systems' seven analysts currently expect revenues in 2025 to be US$12.8b, approximately in line with the last 12 months. Per-share statutory losses are expected to explode, reaching US$0.29 per share. In the lead-up to this report, the analysts had been modelling revenues of US$13.1b and earnings per share (EPS) of US$0.23 in 2025. There looks to have been a significant drop in sentiment regarding Community Health Systems' prospects after these latest results, with a small dip in revenues and the analysts now forecasting a loss instead of a profit.

There was no major change to the consensus price target of US$5.26, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Community Health Systems, with the most bullish analyst valuing it at US$6.00 and the most bearish at US$4.80 per share. This is a very narrow spread of estimates, implying either that Community Health Systems is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Community Health Systems' past performance and to peers in the same industry. From these estimates it looks as though the analysts expect the years of declining revenue to come to an end, given the flat forecast out to 2025. That would be a definite improvement, given that the past five years have seen revenue shrink 0.3% annually. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 6.7% per year. So it's pretty clear that, although revenues are improving, Community Health Systems is still expected to grow slower than the industry.

The Bottom Line

The biggest low-light for us was that the forecasts for Community Health Systems dropped from profits to a loss next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$5.26, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Community Health Systems analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Community Health Systems has 2 warning signs we think you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.