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HCA Healthcare's (HCA) Q3 Earnings Beat Estimates, Up Y/Y

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HCA Healthcare, Inc. HCA reported third-quarter 2018 adjusted earnings of $2.16 per share, surpassing the Zacks Consensus Estimate by 11.9%. Moreover, the bottom line shot up nearly 78.5% year over year. This upside was backed by higher same facility admissions.

The company’s net income per share of $2.15 in the third quarter includes 1 cent gained from the sale of facilities and 2 cents from the loss on retirement of debt.

HCA Healthcare, Inc. Price, Consensus and EPS Surprise

HCA Healthcare, Inc. Price, Consensus and EPS Surprise | HCA Healthcare, Inc. Quote

Quarterly Details

HCA Healthcare generated revenues of $11.4 billion, beating the Zacks Consensus Estimate of $11.3 billion by 1.6%. The top line was up 7.1% from the year-ago period, primarily driven by higher admissions.

Same facility equivalent admissions increased 3.4% year over year while same facility admissions rose 3.1%. Same facility revenues per equivalent admission grew 3.9%.

In the third quarter, cash flow from operations totaled $1.721 billion.

Expenses increased nearly 4.7% year over year to $10.3 billion.

Adjusted EBITDA totaled $2.1 billion, up 18.0% year over year.

As of Sep 30, 2018, HCA operated 179 hospitals and around 1,800 sites of care including surgery centers, freestanding emergency rooms, urgent care centers and physician clinics.

Financial Update

As of Sep 30, 2018, the company had cash and cash equivalents of about $868 million, total debt of $33.2 billion and total assets of $37.7 billion.

During the reported quarter, capital expenditures summed $880 million excluding acquisitions. Cash flows from operating activities were $1.5 billion, up 12.6% year over year.

Dividend Update

HCA Healthcare has announced a quarterly cash dividend of 35 cents per share payable Dec 28 to stockholders of record at the close of business on Dec 3, 2018.

2018 Outlook Updated

The company expects 2018 revenues in the range of $46-$47 billion, up from its prior estimate of $45.5-$46.5 billion. Moreover, it now anticipates adjusted EBIDTA to be between $8.7 and $8.9 billion, up from the prior guided range of $8.65-$8.85 billion. EPS is projected to be in the range of $9.05-$9.45, up from $9-$9.40. The company reiterates its capex view of about $3.5 billion.

Zacks Rank

HCA Healthcare carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Releases From the Medical Sector

UnitedHealth Group Incorporated’s UNH third-quarter bottom line beat estimates on the back of higher revenues.

Centene Inc.’s CNC third-quarter earnings surpassed estimates, majorly driven by the execution of growth strategy and solid operating metrics.

Community Health Systems, Inc. CYH came up with a loss, wider than expected due to lower number of admissions in the quarter.

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