HCA Healthcare, Inc. (NYSE:HCA) is one of the best medical stocks to buy now. In a report released on September 26, Sarah James from Cantor Fitzgerald reiterated a Buy rating on HCA Healthcare, Inc. (NYSE:HCA) and set a price target of $444.00. Jim Cramer Is Worried About HCA Healthcare, Inc. (HCA) Due To Medicaid Cuts HCA Healthcare, Inc. (NYSE:HCA) reported a 6.4% growth in its revenues for fiscal Q2 2025 to $18.605 billion, while net income attributable to the company rose 13.1% to $1.653 billion. Ma ...

Shares of HCA Healthcare (NYSE: HCA ) have been a moderate performer over the past year, gaining about 4%. While shares struggled after President Trump’s victory last year amidst concern about changes in healthcare policy, shares have since recovered despite policy changes, given strong underlyingOver fifteen years of experience making contrarian bets based on my macro view and stock-specific turnaround stories to garner outsized returns with a favorable risk/reward profile. If you want me to cover a specif ...

NASHVILLE, Tenn.--(BUSINESS WIRE)--HCA Healthcare, Inc. (NYSE:HCA), one of the nation's leading healthcare providers, today presented its annual HCA Healthcare Awards of Distinction at a ceremony in Nashville, Tennessee. The HCA Healthcare Awards of Distinction—comprising the Frist Humanitarian Award and the Excellence in Nursing Award—are the highest honors HCA Healthcare bestows on employees, physicians and volunteers, recognizing the extraordinary individuals who exemplify the organization's. ...

Core Viewpoint - HCA Healthcare, Inc. is trading at a premium compared to historical and industry benchmarks, with a forward 12-month P/E ratio of 14.67X, exceeding its five-year median of 13.91X and the industry average of 13.31X [1][2]. Financial Position - As of the end of Q2 2025, HCA had $939 million in cash and equivalents, a 51.4% decline from year-end 2024. Long-term debt rose to $39.4 billion, leading to a 9.5% increase in interest expenses year over year in the first half of 2025 [4]. - HCA generated free cash flow of $7.3 billion over the trailing 12 months, reflecting a 29.3% growth from the prior year, which provides flexibility for acquisitions, debt reduction, and shareholder returns [5]. - The company has been aggressive in capital deployment, repurchasing $3.8 billion in shares in 2023, $6 billion in 2024, and another $5 billion in the first half of 2025, with dividend payouts totaling $351 million [6]. Price Performance - HCA shares have increased by 34.3% year-to-date, outperforming the industry average of 27.3% and the S&P 500 Index's gain of 13.5% [7]. - Earnings are projected to grow by 18.9% in 2025 and 7.1% in 2026, with the consensus estimate for 2025 earnings at $26.11 per share [9][12]. Growth Drivers - HCA benefits from rising admissions, with same-facility equivalent admissions increasing by 2.2% year over year and revenue per equivalent admission climbing by 3.5% in the first half of 2025 [10]. - The company is investing in infrastructure, clinical systems, digital upgrades, and modernized care models to support higher patient volumes and improve efficiency [11]. Headwinds - HCA faces challenges from regulatory shifts and reimbursement pressures, as well as a growing trend towards home-based services that may dilute patient volumes in traditional facilities [14]. - Operational metrics show strain, with outpatient surgery cases declining by 1.9% in 2024 and another 1.3% in the first half of 2025, alongside a steady contraction in average length of stay [15]. Bottom Line - HCA's strong earnings outlook, consistent cash flow generation, and shareholder-friendly capital deployment highlight its strength as a leading hospital operator. However, elevated valuation, mounting debt, and regulatory challenges temper the bullish case [18].

Demand Environment - The demand environment has shown some natural variability, which has become an expected aspect of the business over time [2] - There was a noticeable slowdown in volume growth during the second quarter compared to previous periods [2] - Medicare and Medicaid volumes were specifically highlighted as being weaker than anticipated at the beginning of the year [3] Volume Trends - The transition from Q1 to Q2 revealed key moving parts affecting volume trends, particularly in the Medicare and Medicaid sectors [3]

Financial Data and Key Metrics Changes - The company reported a 6.4% top-line growth in the quarter, which is considered strong despite lower volume growth [14][18] - Volume growth for the first six months was 2.3%, which is below the original guidance of 3% to 4% [7][24] - Medicaid volume decreased by 1.2% year-to-date compared to the prior year, which was unexpected [8][12] - Self-pay volume increased by only 1.5% year-to-date, significantly lower than the anticipated 3% to 4% range [10][12] - Medicare volume growth was at 3%, slightly below the initial estimates of 3.5% to 4% [16][18] Business Line Data and Key Metrics Changes - The commercial book excluding exchanges saw a growth of just under 1% in the first half of the year, compared to a normal growth of 1% to 2% [40][46] - Total commercial book growth, including exchanges, was around 4% to 4.5% [42][46] - Exchange volume growth was 13% year-to-date, down from a 40% increase in the previous year [32][34] Market Data and Key Metrics Changes - The healthcare exchanges accounted for about 8% of the company's volume and 10% of revenue, with utilization patterns being between commercial and Medicaid [120][127] - The company noted that exchange patients utilize more emergency care and fewer elective procedures compared to the average employer-based population [119][122] Company Strategy and Development Direction - The company remains focused on organic growth within its 43 markets, with a robust pipeline of investment opportunities [195][196] - M&A activity is ongoing, particularly in the outpatient sector, with recent acquisitions of urgent care systems and freestanding emergency rooms [197][200] - The company emphasizes a disciplined approach to capital allocation, balancing investments, dividends, and share repurchases [200][212] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand environment despite some volume softness, indicating a stable operating environment for labor costs [87][89] - The company is closely monitoring the potential impacts of enhanced exchange subsidies and Medicaid supplemental payments, with plans to provide more guidance in the fourth quarter [114][118] - Management highlighted the importance of revenue integrity and operational efficiency as key components of their resiliency plan [144][150] Other Important Information - The company raised its guidance by $300 million at the midpoint, with $150 million attributed to state supplemental payments [54][56] - There is an expected decline of about $130 million in state supplemental payments in the second half of the year [58][60] - Labor costs are stabilizing, with a notable decrease in the use of contract labor [87][89] Q&A Session Summary Question: Can you expand on the volume trends from Q1 to Q2? - Management noted that volume growth was lower than expected, particularly in Medicaid and self-pay categories, contributing to the overall shortfall [7][12] Question: How do you view the impact of exchange growth on comparisons? - Management acknowledged that last year's strong exchange enrollment growth made this year's comparisons more challenging [24][28] Question: What are the expectations for the second half of the year? - Management indicated that the implied growth rate in the second half is consistent with the first half, considering various moving parts [72][76] Question: How is the company addressing labor cost pressures? - Management reported stable labor costs and improvements in staff retention, with a focus on reducing premium labor usage [87][89] Question: What is the company's stance on enhanced exchange subsidies? - Management is optimistic about the potential extension of subsidies but is awaiting further developments [111][118] Question: How does the company view its M&A strategy moving forward? - Management emphasized a disciplined approach to M&A, focusing on organic growth while remaining active in outpatient acquisitions [197][200]

Financial Data and Key Metrics Changes - The company reported a 6.4% top-line growth in the quarter, despite a volume growth of only 2.3% equivalent admissions year-to-date, which was below the original guidance of 3% to 4% [15][7][5] - Medicaid volume decreased by 1.2% year-to-date, which was expected to be flat or slightly up, impacting approximately 17% of total volume [8][7] - Self-pay volume increased by only 1.5% year-to-date, significantly lower than the anticipated 3% to 4% range [11][13] - Medicare volume growth was at 3%, slightly below the initial estimate of 3.5% to 4% [17][19] Business Line Data and Key Metrics Changes - The commercial book, excluding exchanges, saw growth of just under 1% in the first half of the year, compared to a normal range of 1% to 2% growth [39][41] - Total commercial book growth, including exchanges, was around 4% to 4.5% year-to-date [43][45] - Exchange volume growth was 3% from Q1 to Q2, compared to a 15% increase in the previous year [31][29] Market Data and Key Metrics Changes - The healthcare exchanges accounted for about 8% of total volume and 10% of revenue, with utilization patterns falling between commercial and Medicaid populations [121][127] - The company noted that exchange patients utilize emergency care more than average employer-based patients and have lower utilization of elective procedures [123][121] Company Strategy and Development Direction - The company remains focused on organic growth within its 43 markets, investing 45% to 55% of capital back into these markets [193][196] - M&A activity is ongoing, with two acute care hospitals acquired this year and continued interest in outpatient acquisitions [198][200] - The company is committed to maintaining a balanced approach to capital allocation, including dividends and share repurchase programs [201][210] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the stability of the labor market, noting improvements in wage inflation and retention rates [88][90] - The company is actively monitoring the potential impacts of enhanced exchange subsidies and Medicaid supplemental payments, with plans to provide more guidance in the fourth quarter [115][120] - Management highlighted the importance of revenue integrity and asset utilization as key components of their resiliency plan [145][146] Other Important Information - The company is leveraging advanced technologies, including AI, to improve claims processing and reduce denials [156][162] - Management indicated that the proposed OPPS rule was disappointing, while the inpatient IPPS rule was more favorable than expected [189][191] Q&A Session Summary Question: Can you elaborate on the volume trends from Q1 to Q2? - Management noted a decrease in Medicaid and self-pay volumes, contributing to lower overall volume growth than anticipated [7][11] Question: How do you view the impact of exchange growth on comparisons? - Management acknowledged that last year's exchange enrollment growth created a tougher comparison for this year [25][27] Question: What are the expectations for the second half of the year? - Management indicated that the implied growth rate for the second half is consistent with the first half, considering various moving parts [74][78] Question: How is the company addressing labor costs? - Management reported stable labor costs and improvements in retention rates, with a focus on reducing reliance on contract labor [88][90] Question: What is the company's stance on enhanced exchange subsidies? - Management is optimistic about the potential extension of subsidies but emphasized the need for clarity before making specific estimates [112][115] Question: How does the company view its M&A strategy moving forward? - Management confirmed ongoing M&A activity, particularly in outpatient services, while maintaining a disciplined approach to capital allocation [198][200]

Part I. Financial Information [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) HCA Healthcare's unaudited consolidated financial statements detail performance and position for Q2 and 6M 2025 and 2024. [Condensed Consolidated Income Statements](index=3&type=section&id=Condensed%20Consolidated%20Income%20Statements) HCA Healthcare's income statements detail Q2 and 6M 2025 financial performance, highlighting revenue, net income, and EPS growth. | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :----------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Revenues | $18,605 | $17,492 | $36,926 | $34,831 | | Net income attributable to HCA Healthcare, Inc. | $1,653 | $1,461 | $3,263 | $3,052 | | Diluted earnings per share | $6.83 | $5.53 | $13.28 | $11.47 | | Shares used in diluted EPS (millions) | 241.911 | 264.071 | 245.654 | 266.044 | - Revenues increased by **$1.113 billion (6.4%)** for Q2 2025 and **$2.095 billion (6.0%)** for the six months ended June 30, 2025, compared to the respective prior-year periods[9](index=9&type=chunk) - Net income attributable to HCA Healthcare, Inc. grew by **$192 million (13.1%)** in Q2 2025 and **$211 million (6.9%)** for the six months ended June 30, 2025, year-over-year[9](index=9&type=chunk) [Condensed Consolidated Comprehensive Income Statements](index=4&type=section&id=Condensed%20Consolidated%20Comprehensive%20Income%20Statements) Comprehensive income statements detail total comprehensive income, including net income and other income/loss items. | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :----------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Net income | $1,891 | $1,687 | $3,716 | $3,489 | | Other comprehensive income (loss) | $48 | $0 | $78 | $(8) | | Comprehensive income | $1,939 | $1,687 | $3,794 | $3,481 | | Comprehensive income attributable to HCA Healthcare, Inc. | $1,701 | $1,461 | $3,341 | $3,044 | - Other comprehensive income (loss) before taxes for Q2 2025 was **$58 million**, primarily driven by foreign currency translation gains of **$55 million**[11](index=11&type=chunk) - Comprehensive income attributable to HCA Healthcare, Inc. increased by **$240 million (16.4%)** in Q2 2025 and **$297 million (9.8%)** for the six months ended June 30, 2025, year-over-year[11](index=11&type=chunk) [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance sheets show stable total assets, decreased current assets, increased current liabilities, and negative working capital. | Item | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :----------------------------------- | :------------------------ | :-------------------------- | | Total Assets | $59,536 | $59,513 | | Current Assets | $15,563 | $16,414 | | Property and equipment, net | $30,123 | $29,414 | | Goodwill and other intangible assets | $10,273 | $10,093 | | Total Liabilities | $55,775 | $53,958 | | Current Liabilities | $15,939 | $15,177 | | Long-term debt, net | $39,379 | $38,333 | | Stockholders' deficit attributable to HCA Healthcare, Inc. | $(4,394) | $(2,499) | | Noncontrolling interests | $3,156 | $3,054 | - Cash and cash equivalents decreased significantly from **$1,933 million** at December 31, 2024, to **$939 million** at June 30, 2025[14](index=14&type=chunk) - The company moved from a **positive working capital of $1,237 million** at December 31, 2024, to a **negative working capital of $376 million** at June 30, 2025, primarily due to increased short-term borrowings and other accrued expenses, and a decline in cash[14](index=14&type=chunk)[115](index=115&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Deficit)) Stockholders' equity statements detail changes for Q2 and 6M 2025 and 2024, highlighting comprehensive income, share repurchases, and dividends. | Item | Balances, Dec 31, 2024 (Millions) | Balances, June 30, 2025 (Millions) | | :----------------------------------- | :------------------------------- | :------------------------------ | | Common Stock Par Value | $3 | $2 | | Accumulated Other Comprehensive Loss | $(387) | $(309) | | Retained Deficit | $(2,115) | $(4,087) | | Stockholders' Deficit Attributable to HCA Healthcare, Inc. | $(2,499) | $(4,394) | | Noncontrolling Interests | $3,054 | $3,156 | | Total Equity (Deficit) | $555 | $(1,238) | - During the six months ended June 30, 2025, the company repurchased **14.793 million shares** of common stock for **$5.011 billion**[16](index=16&type=chunk)[104](index=104&type=chunk)[117](index=117&type=chunk) - Cash dividends declared were **$0.72 per share** for both quarters in 2025, totaling **$351 million** for the six months ended June 30, 2025[16](index=16&type=chunk)[117](index=117&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flow statements highlight cash sources and uses for 6M 2025 and 2024, showing increased operating cash and higher financing outflows. | Cash Flow Category | 6M 2025 (Millions) | 6M 2024 (Millions) | | :----------------------------------- | :------------------ | :------------------ | | Net cash provided by operating activities | $5,861 | $4,440 | | Net cash used in investing activities | $(2,283) | $(2,235) | | Net cash used in financing activities | $(4,584) | $(2,309) | | Change in cash and cash equivalents | $(994) | $(104) | | Cash and cash equivalents at end of period | $939 | $831 | - Net cash provided by operating activities increased by **$1.421 billion**, primarily due to a **$392 million** increase in net income (excluding non-cash impacts of facility sales) and an **$853 million** decline in income taxes paid due to an IRS deferral[18](index=18&type=chunk)[115](index=115&type=chunk) - Net cash used in financing activities increased by **$2.275 billion**, driven by **$5.011 billion** in common stock repurchases and **$5.660 billion** in long-term debt repayments[18](index=18&type=chunk)[117](index=117&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide essential disclosures for understanding the financial statements, covering accounting policies, acquisitions, debt, contingencies, and segment information. [NOTE 1 — BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES](index=8&type=section&id=NOTE%201%20%E2%80%94%20BASIS%20OF%20PRESENTATION%20AND%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the company's reporting entity, interim financial statement preparation, and revenue recognition policies, including uncompensated care costs. - HCA Healthcare, Inc. operates **191 hospitals**, **124 freestanding surgery centers**, and **29 freestanding endoscopy centers** across 20 states and England as of June 30, 2025[19](index=19&type=chunk) Revenues by Primary Third-Party Payer Classification (Q2 2025 vs Q2 2024) | Payer Classification | Q2 2025 Revenue (Millions) | Q2 2025 Ratio | Q2 2024 Revenue (Millions) | Q2 2024 Ratio | | :----------------------------------- | :------------------------ | :------------- | :------------------------ | :------------- | | Managed care and insurers | $9,124 | 49.1% | $8,

Industry Overview - The healthcare sector has seen a 0.79% decline year-to-date, making it the worst performer among the S&P 500's 11 sectors and the only one in negative territory [1] - Over the past three months, healthcare remains the worst-performing sector [1] - National healthcare expenditures in the U.S. rose from $3.756 trillion in 2019 to $5.049 trillion in 2024, a 34.42% increase, while EBITDA for healthcare services has only seen a compound annual growth rate (CAGR) of 8.5% during the same period [3][4] Company Performance - HCA Healthcare has gained 14% year-to-date, contrasting sharply with the 44% loss experienced by UnitedHealth Group [2] - HCA Healthcare reported Q2 results with EPS of $6.84, exceeding expectations of $6.20, and revenues of $18.61 billion, surpassing expectations of $18.49 billion, marking a 24.4% and 6.4% year-over-year increase, respectively [11] - HCA's net income increased by 13.1% to $1.653 billion [11] Company Growth and Strategy - HCA Healthcare is the largest healthcare system in the U.S., with a market cap of $81.56 billion, owning 222 hospitals and over 2,000 outpatient sites [7][8] - The company has acquired 23 companies from 2011 to 2024, including six in 2017, demonstrating a strong focus on mergers and acquisitions [10] - HCA's free cash flow increased by 36.63% from $4.127 billion in 2022 to $5.639 billion in 2024 [10] Analyst Ratings and Forecasts - HCA Healthcare has a consensus Moderate Buy rating, with nine out of 18 analysts assigning it a Buy rating and the average 12-month price target set at $396.46, indicating a potential upside of 16.56% [13] - The company forecasts EPS growth of 12.21% to $28.03 for the next year [12] - HCA Healthcare currently pays a modest dividend yielding 0.85%, with a low dividend payout ratio of 12.11%, indicating a balance between rewarding shareholders and reinvesting for growth [14]

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