HCA Healthcare (HCA) Beats on Q2 Earnings, Ups 2023 EPS View
HCA Healthcare, Inc. HCA reported second-quarter 2023 adjusted earnings per share (EPS) of $4.29, which surpassed the Zacks Consensus Estimate by 0.2%. Also, the bottom line climbed 1.9% year over year.
HCA’s revenues advanced 7% year over year to $15.9 billion. The top line beat the consensus mark by 1.8%.
The quarterly results gained from expanding patient volumes and increased surgeries, which contributed substantially to the top line of HCA Healthcare. However, the upside was partly offset by escalating salaries and benefits expenses.
HCA Healthcare, Inc. Price, Consensus and EPS Surprise
HCA Healthcare, Inc. price-consensus-eps-surprise-chart | HCA Healthcare, Inc. Quote
Quarterly Details
While same-facility equivalent admissions rose 3.7% year over year in the second quarter, same-facility admissions improved 2.2% year over year. The metrics surpassed our estimates by 1.2% and 1%, respectively.
Same-facility revenue per equivalent admission rose 2.4% year over year in the quarter under review. This metric lagged our estimate by 1%.
Same-facility inpatient surgeries and same-facility outpatient surgeries advanced 1.8% and 3.3%, respectively, year over year. While same-facility inpatient surgeries matched our estimate, same-facility outpatient surgeries outpaced our estimate by 2.3%. Meanwhile, same-facility emergency room visits increased 3.7% year over year. This metric lagged our estimate by 2.5%.
Salaries and benefits, supplies and other operating expenses increased 8.6% year over year to $12.8 billion and surpassed our estimate of $12.4 billion.
Adjusted EBITDA of $3.1 billion grew 0.5% year over year in the second quarter. This metric beat our estimate by 3.3%.
HCA Healthcare operated 182 hospitals and roughly 2,300 ambulatory sites of care across 20 states of the United States and the United Kingdom as of Jun 30, 2023.
Financial Update (as of Jun 30, 2023)
HCA Healthcare exited the second quarter with cash and cash equivalents of $862 million, which dropped from $908 million at 2022-end. It had a leftover capacity of $6.9 billion under its credit facilities at the second-quarter end.
Total assets of $53.6 billion increased from $52.4 billion at 2022-end.
Long-term debt, excluding debt issuance costs and discounts, amounted to $36.5 billion, down from $37.7 billion at 2022-end.
In the reported quarter, capital expenditures were at $1.2 billion minus acquisitions.
Cash Flows
HCA Healthcare generated cash from operations amounting to $2.5 billion in the second quarter, which surged 51.8% year over year.
Capital Deployment Update
HCA bought back shares worth $915 million in the second quarter. As of Jun 30, 2023, $2.8 billion was left under its buyback authorization.
The Board of Directors approved a quarterly cash dividend of 60 cents per share, which will be paid out on Sep 29, 2023, to its shareholders of record as of Sep 15.
2023 View Revised
Annual revenues are anticipated to stay between $63.3 billion and $64.8 billion, up from the prior view of $62.5-$64.5 billion. The midpoint of the revised outlook indicates growth of 6.3% from the 2022 reported figure.
Adjusted EBITDA is forecasted between $12.3 billion and $12.8 billion, higher than the previous guidance of $12.1-$12.7 billion. The midpoint of the updated outlook suggests 4% growth from the 2022 figure.
Management estimates net income attributable to HCA Healthcare to lie between $4.9 billion and $5.3 billion, up from the prior outlook of $4.8-$5.2 billion.
EPS is predicted to be in the $17.70-$18.90 band, higher than the previous view of $17.25-$18.55. The midpoint of the revised guidance implies 8.3% growth from the 2022 figure.
Capital expenditures, excluding acquisitions, are expected at roughly $4.7 billion. The earlier outlook of the metric was roughly around $4.6 billion.
Zacks Rank
HCA Healthcare currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Some Other Conglomerates
Of the Medical sector players that have reported second-quarter results so far, the bottom lines of Elevance Health, Inc. ELV, UnitedHealth Group Incorporated UNH and Universal Health Services, Inc. UHS beat the Zacks Consensus Estimate.
Elevance Health reported second-quarter 2023 adjusted net income of $9.04 per share, which outpaced the Zacks Consensus Estimate by 2.5%. The bottom line improved 13.4% year over year.
ELV’s operating revenues, which amounted to $43,377 million, rose 12.7% year over year in the quarter under review. The top line surpassed the consensus mark by 4.5%.
UnitedHealth Group reported second-quarter 2023 adjusted EPS of $6.14, which outpaced the Zacks Consensus Estimate by 3.7%. The bottom line advanced 10.2% year over year.
Revenues improved 16% year over year to $92.9 billion in the quarter under review, attributable to sound contributions made by the UnitedHealthcare and Optum business lines. The top line surpassed the consensus mark by 2.5%.
Universal Health reported second-quarter 2023 adjusted EPS of $2.53, which outpaced the Zacks Consensus Estimate by 2%. The bottom line advanced 15% year over year.
UHS’s operating revenues, which amounted to $3.6 billion, rose 6.9% year over year in the quarter under review. The top line surpassed the consensus mark by 1.3%.
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