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Why Tenet Healthcare (THC) Outpaced the Stock Market Today

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Tenet Healthcare (THC - Free Report) closed the latest trading day at $154.62, indicating a +0.91% change from the previous session's end. The stock outpaced the S&P 500's daily gain of 0.45%. Elsewhere, the Dow lost 0.23%, while the tech-heavy Nasdaq added 0.84%.

The hospital operator's stock has climbed by 1.15% in the past month, falling short of the Medical sector's gain of 3.16% and the S&P 500's gain of 2.54%.

The investment community will be closely monitoring the performance of Tenet Healthcare in its forthcoming earnings report. The company is forecasted to report an EPS of $2.33, showcasing a 61.81% upward movement from the corresponding quarter of the prior year. Alongside, our most recent consensus estimate is anticipating revenue of $5.05 billion, indicating a 0.39% downward movement from the same quarter last year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $10.70 per share and a revenue of $20.84 billion, signifying shifts of +53.3% and +1.41%, respectively, from the last year.

Investors might also notice recent changes to analyst estimates for Tenet Healthcare. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Currently, Tenet Healthcare is carrying a Zacks Rank of #1 (Strong Buy).

In terms of valuation, Tenet Healthcare is presently being traded at a Forward P/E ratio of 14.31. This indicates a discount in contrast to its industry's Forward P/E of 15.73.

Also, we should mention that THC has a PEG ratio of 0.78. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. Medical - Hospital stocks are, on average, holding a PEG ratio of 1.11 based on yesterday's closing prices.

The Medical - Hospital industry is part of the Medical sector. At present, this industry carries a Zacks Industry Rank of 4, placing it within the top 2% of over 250 industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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