Deutsche downgrades CHS, says to keep buying HCA, Vanguard

Analyst Darren Lehrich at Deutsche Bank says investors should stop being universally bullish on the hospital sector after the big run-up of the past few months. He has lowered his rating on Community Health Systems (as well as Health Management Associates and Tenet Healthcare) but has kept 'buy' ratings on fellow locals HCA Holdings and Vanguard Health Systems.

"While we maintain a generally constructive view on the potential for higher EBITDA/EPS growth in 2014-2015 due to coverage expansion from PPACA, we believe the PPACA theme is largely discounted into the group's valuation at current levels (~6.5x EV/EBITDA)."

Shares of CHS (Ticker: CYH) are off more than 4 percent to about $42 in mid-morning trading Wednesday. Lehrich's CHS target is now $48.