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How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in HCA Holdings (HCA) ten years ago? It may not have been easy to hold on to HCA for all that time, but if you did, how much would your investment be worth today?
HCA Holdings' Business In-Depth
With that in mind, let's take a look at HCA Holdings' main business drivers.
Effective May 8, 2017, the company’s name was changed to HCA Healthcare, Inc. from HCA Holdings, Inc. It is the largest non-governmental operator of acute care hospitals in the U.S. Headquartered in Nashville, TN, it operates hospitals and related health care entities.
At the end of 2020, the company operated 185 hospitals, comprised of 178 general, acute care hospitals; five psychiatric hospitals; and two rehabilitation hospitals. The company also operated 121 freestanding surgery centers and 21 freestanding endoscopy centers. Its business is spread across 20 states and England.
The general, acute care hospitals also provide outpatient services such as outpatient surgery, laboratory, radiology, respiratory therapy, cardiology and physical therapy
It operates in two geographically organized groups – the National and American Groups.
The National Group includes 96 hospitals across Alaska, California, Florida, southern Georgia, Idaho, Indiana, northern Kentucky, Nevada, New Hampshire, North Carolina, South Carolina, Utah and Virginia.
The American Group includes 82 hospitals across Colorado, northern Georgia, Kansas, southern Kentucky, Louisiana, Missouri, Tennessee and Texas. The company also operates six hospitals in England that are included in the Corporate and Other group.
The company's general, acute care hospitals with 48,492 licensed beds provide a wide range of services to cater to different medical specialties, such as internal medicine, general surgery, cardiology, oncology, neurosurgery, orthopedics and obstetrics as well as diagnostic and emergency services. As of Dec 31, 2020, HCA Healthcare’s five psychiatric hospitals with 593 licensed beds offered a full range of mental health care services through inpatient, partial hospitalization and outpatient settings.
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in HCA Holdings a decade ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in May 2011 would be worth $5,858.28, or a 485.83% gain, as of May 19, 2021, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
The S&P 500 rose 207.89% and the price of gold increased 20.18% over the same time frame in comparison.
Going forward, analysts are expecting more upside for HCA.
HCA Healthcare’s first-quarter earnings of $4.14 per share outpaced the Zacks Consensus Estimate by 23.6% and also soared 77.7% year over year on higher revenues. Its shares have outperformed its industry in a year's time. The company's multiple buyouts have helped it increase its patient volumes, enabled network expansion and added hospitals to its portfolio. The company has also taken up cost curbing measures, which would likely aid margins. With the rise in usage of telehealth medicine, the company expanded its telemedicine product offerings. Its solid 2021 outlook impresses. However, the company escalating operating expenses persistently weigh on the margins. High leverage is another concern. The COVID-19 pressure on revenues also bothers the company.
Shares have gained 6.48% over the past four weeks and there have been 7 higher earnings estimate revisions for fiscal 2021 compared to none lower. The consensus estimate has moved up as well.
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