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What's in the Cards for HCA Healthcare (HCA) Q4 Earnings?

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·4 min read
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HCA Healthcare, Inc. HCA is scheduled to release fourth-quarter 2020 results on Feb 2.

The company's third-quarter 2020 adjusted earnings of $1.92 per share missed the Zacks Consensus Estimate by 28.6%. Further, the bottom line declined 13.9% year over year due to lower patient admissions and higher costs.

Factors to Note

The company’s fourth-quarter revenues are expected to have benefited from a gradual rise in patient volumes and resumption of non-emergent procedures following the easing of restrictions imposed by the government to curb the COVID-19 spread. With the economy slowly bouncing back, things are looking up for the company. It witnessed better admissions starting October 2020. The Zacks Consensus Estimate for HCA Healthcare’s revenues stands at $13.9 billion, suggesting growth of 3.2% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for fourth-quarter earnings is pegged at $3.58, indicating an upside of 15.9% from the year-earlier quarter’s reported figure. This upside is likely to have been backed by better admissions leading to improved revenues.

Notably, the company’s number of outpatient facilities resumed operations, which in turn, might have provided a boost to patient admissions in the to-be-reported quarter. The Zacks Consensus Estimate for admissions implies a 0.5% improvement from the year-ago period’s reported figure.

The surgical volume is also expected to have expanded in the to-be-reported quarter, courtesy of the relaxation in restrictions. The consensus mark for outpatient surgical cases indicates an upside of 5.3% from the prior-year quarter’s reported figure.

Moreover, the company is likely to have added more hospitals to its portfolio to enhance its capabilities. The consensus mark for total number of hospitals suggests an increase of 1.6% from the year-earlier quarter’s reported number. The consensus estimate for fourth-quarter patient days implies a 6.4% rise from the year-ago quarter’s actuals.

Despite several cost-cutting efforts, the company’s performance is likely to have suffered elevated expenses due to operating costs and substantial growth-related investments.

What Our Quantitative Model Predicts

Our proven model does not conclusively predict an earnings beat for HCA Healthcare this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Earnings ESP: HCA Healthcare has an Earnings ESP of -5.39%. This is because the Most Accurate Estimate of $3.39 is pegged lower than the Zacks Consensus Estimate of $3.58. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

HCA Healthcare, Inc. Price and EPS Surprise

HCA Healthcare, Inc. Price and EPS Surprise
HCA Healthcare, Inc. Price and EPS Surprise

HCA Healthcare, Inc. price-eps-surprise | HCA Healthcare, Inc. Quote

Zacks Rank: HCA Healthcare carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

Here are some stocks worth considering from the medical sector with the perfect mix of elements to surpass estimates in their upcoming releases:

Alexion Pharmaceuticals, Inc. ALXN has an Earnings ESP of +12.29% and a Zacks Rank #2, currently. The company is scheduled to release fourth-quarter 2020 earnings on Feb 4.

Tenet Healthcare Corporation THC has an Earnings ESP of +7.10% and a Zacks Rank of 1, presently. The company is scheduled to release fourth-quarter 2020 earnings on Feb 9.

Teladoc Health, Inc. TDOC has an Earnings ESP of +31.58% and a Zacks Rank of 2, presently. The company is scheduled to release fourth-quarter 2020 earnings on Feb 24.

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