On Mar 23, 2015, shares of HCA Holdings Inc. HCA scaled a new 52-week high of $78.44. The company's solid fourth-quarter results can be arrtributed to the share price rise. With about 4.5 million shares exchanging hands in the last trading session, the stock closed at $77.64 per share, gaining 1.12%.
The one-year return from the stock came in at 54.8%, which outperformed the return of 12.7% clocked by the S&P 500 index.
On Feb 3, HCA Holdings reported fourth-quarter 2014 operating earnings of $1.33 per share, which surpassed the Zacks Consensus Estimate of $1.25 by 6.4% and improved from the year ago figure of 92 cents per share. Strong volume metrics, favorable payer mix and excellent cost management drove the upside.
Total revenue also improved 9.1% year over year and surpassed the Zacks Consensus Estimate by 0.14%. The upside was driven by an increase of $68 million in the Medicaid revenues related to the Texas Medicaid Waiver Program.
Based on solid performance in the fourth quarter, the company raised its 2015 guidance. HCA Holdings now expects revenues of $38.5 billion to $39.5 billion (up 7% from 2014), adjusted EBITDA of $7.35 billion to $7.65 billion (up 3.4% from 2014), and operating earnings in the range of $4.55 to $4.95 per share (up 5.3% from 2014).
The company's guidance is well supported by its strong balance sheet and capital position as of 2014 end. This is evident from a sturdy cash position that rose 31% in 2014 from the 2013-end level, while operating cash flow increased to $4.4 billion from $3.7 billion in 2013. These factors brighten the company's prospects.
Currently, HCA Holdings carries a Zacks Rank #3 (Hold).
Stocks to Consider
Better-ranked stocks include Almost Family Inc. AFAM, MEDNAX Inc. MD and VCA Inc. WOOF. While Almost Family sports a Zacks Rank #1 (Strong Buy), MEDNAX and VCA hold a Zacks Rank #2 (Buy).
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