Jefferies analyst Brian Tanquilut has taken his price target for shares of HCA Holdings from $112 all the way down to $88 after the hospital giant previewed its third-quarter profits and said its personnel costs had risen over the summer. Tanquilut also has trimmed his earnings estimates for this year and next. But he is sticking to his 'buy' rating and says HCA can continue to grow its business.
At about 12:30 p.m., HCA shares (Ticker: HCA) were off more than 6 percent to about $71.20. They're now down slightly year to date.
Analyst Brian Tanquilut at Jefferies & Co. sees many bright days ahead for Acadia Healthcare investors. Following the company's second-quarter earnings report, he has raised his price target for the stock to $100 from $88. That leaves a lot of upside: Acadia (Ticker: ACHC) closed last week's trading at $81.02 and is to $81.84 this afternoon.
Hospital stocks are seeing a lot of action after the Supreme Court ruled Thursday to uphold subsidies for consumers buying health insurance in states using the federal marketplace.
Avondale Partners analyst Paula Torch reiterated her 'market outperform' rating for HCA Holdings and raised the firm's price target to $103 from $90, saying the Supreme Court ruling "clears the runway for the multiple to expand."
Mizuho analyst Sheryl Skolnick has upgraded the stocks of Community Health Systems from 'neutral' to 'buy' and raised her $52 price target all the way to $83.90. On the flip side, CHS was downgraded by Raymond James John Ransom, who dropped the firm's 'outperform' rating to 'market perform.'
Also happening today:
• Leerink analyst Ana Gupta raised her price target for HCA from $95 to $100. She also raised her target for CHS to $70 from $60 and LifePoint Health from $75 to $85.
• Analysts at Oppenheimer raised their price target on HCA to $82 from $60 and CHS to $102 from $87.
• Jefferies analyst Brian Tanquilut raised his price target for HCA to $108 from $95 and CHS to $79 from $75.
Jefferies & Co. analyst Brian Tanquilut sees bigger things coming from HCA Holdings' positive earnings preview this week. He thinks that "HCA's strong cash flows open up opportunities for stock-enhancing capital deployment" such as acquisitions or share buybacks. (The company late last year spent $500 million to repurchase some of its stock.) Tanquilut also lifted his price target for HCA to $72 from $70.
Mark Montagna at Avondale Partners isn't convinced Genesco's results will improve markedly during the second half of the company's fiscal 2015 and beyond. Several fashion trends — or the clear lack thereof — are working against the shoe and hat retailer, he says, and the rollout of its lower-margin Locker Room chain will hurt profits. But he expects the company will keep its premium valuation, which now is about 14 times earnings, and has hiked his price target to $77 from $70. That leaves about 5 percent of upside for Genesco (Ticker: GCO), which is up slightly year to date.
Jefferies analyst Brian Tanquilut has begun covering shares of Brookdale Senior Living with a 'buy' rating and a price target of $40, which is more than 20 percent above where the stock (Ticker: BKD) now trades. Tanquilut likes the growth prospects of senior housing in general and says the planned acquisition of Emeritus "will yield better-than-expected synergies and incremental equity value as the combined entity puts up healthy growth and exerts its market power."
Jefferies analyst Brian Tanquilut says HCA shares can build on their fall run of more than 20 percent, especially now that the company has told investors it expects Q3 profits to be bigger than expected. Tanquilut has hiked his price target for Nashville's largest company to $57 from $45, leaving about 19 percent of upside from where the stock was trading late Friday morning. Tanquilut also has hiked his earnings estimates for HCA, lifting his 2014 forecast by 9 percent to $3.70.
Over at Susquehanna Financial, analyst Chris Rigg earlier this week — before HCA previewed its Q3 numbers — raised his price target. Rigg now sees the stock (Ticker: HCA) climbing to $54, up from his previous target of $46.
Brian Tanquilut at Jefferies says investors are right to look at Acadia Healthcare as a solid M&A play in the behavioral health sector. But, he added late last week in raising his Acadia price target to $39 from $30, the company also is doing a very nice job raising margins at facilities once it owns them. Acadia (Ticker: ACHC) closed Friday trading at $31.64 and is up 35 percent so far this year.
Oppenheimer analyst Brian Nagel has hiked his rating on shares of Tractor Supply to ‘market outperform’ and lifted his price target to $125 from $100. That puts him at the head of the pack and alongside David Strasser from Janney Montgomery Scott. Tractor Supply shares (Ticker: TSCO) ended last week at almost $111.
Now that's an upgrade...
Analyst Brian Tanquilut at Jefferies has hiked his rating on shares of Community Health Systems to 'buy' from 'hold.' That's nothing too unusual, but the price target hike accompanying it was: Tanquilut now sees CHS (Ticker: CYH) climbing to $56, up from just $29. Despite the strong run by hospital stocks in recent months, he says there's plenty more in store — in part because companies are saying they "expect to be able to charge the new health care exchanges rates for patient treatment closer to what commercial insurers pay than to the much-lower reimbursements Medicare and Medicaid pay."
Michael Rose at Raymond James has gone the other way with shares of Pinnacle Financial Partners, lowering his rating to 'market perform' from 'outperform.' Pinnacle (Ticker: PNFP) closed Monday trading at $23.22 and is up more than 23 percent in 2013.
Analyst Brian Tanquilut at Jefferies has become the latest follower of Nashville's big hospital operators to announce a major price target hike. Tanquilut on Monday reiterated his 'buy' rating on HCA Holdings and told clients he sees the shares going to $45 in the coming year, up from $30. Like many of his peers, he sees positives in the many previously uninsured patients expected to make their way into the system. HCA stock (Ticker: HCA) closed down 1.6 percent Monday but is still up 25 percent so far this year.
Tanquilut said in his note that about 8 percent of the patients HCA admits are uninsured. But he cautioned that the amount of help the overhaul provides will depend on variables like the number of states that expand Medicaid coverage and the number of uninsured people who buy coverage.
Veteran local researcher Whit Mayo says Acadia Healthcare is still one of his favorite plays in the health care arena given its potent combinations of big earnings growth, money in the bank and "benign regulatory risks." The Robert W. Baird analyst has tweaked his price target for Franklin-based Acadia to $32 from $31. The stock (Ticker: ACHC) closed Monday trading around $25.50.
Investors wrestling with just how much to pay for many health care stocks ahead of the presidential election will have another factor to consider come Friday morning. Jefferies analyst Brian Tanquilut says hospital chains and other providers could suffer if Paul Ryan puts up a good performance against Joe Biden. Since Mitt Romney's strong debate last week, HCA shares (Ticker: HCA) are off almost 10 percent.
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