RBC Capital analyst Frank Morgan has reiterated his 'buy' rating for HCA Holdings.
Morgan also raised his price target for the Nashville company to $88. Last fall, his price target for HCA Holdings, which Wednesday previewed better than expected Q1 earnings, was $83.
Shares of HCA (Ticker: HCA) were down nearly 2 percent Thursday afternoon to $77.78. Year to date, they're up almost 6 percent.
Community Health Systems is in talks to buy a struggling Georgia hospital, according to The Ledger-Enquirer.
The Franklin company could fully or partially acquire the 376-bed hospital, which recently completed a $150 million expansion and disclosed an accounting error of nearly $30 million. The Ledger-Enquirer reports the Columbus hospital then began looking for a strategic partner.
St. Francis Hospital said Thursday it has begun 'exclusive discussions' with a subsidiary of Franklin, Tenn.-based Community Health Systems, with an agreement of some sort between the two expected in the 'near future.'
CHS currently operates five hospitals in Georgia. Shares of the company (Ticker: CYH) were down to $52.81 around noon Friday. Year to date, they're down 2 percent.
Persistence paid off for Debra Cafaro.
The Chairman and CEO of Ventas, which plans to pay $1.8 billion for hospital chain Ardent Health Services, on Monday said she's been calling on CEO David Vandewater for 15 years, hoping the time was right for both sides to make a deal. Cafaro, who has led Chicago-based Ventas since 1999, called Ardent a "beachhead investment" that will complement her moves over the years into medical office buildings and senior housing properties,
"We've been waiting a long time to find the right entry point into the domestic hospital market," she said. "Ardent is the deal we've been waiting for."
Many of the details of Ardent's sale have yet to be finalized, which meant Cafaro didn't have all the answers analysts were seeking on a Monday morning conference call. She did say the Nashville-based company has EBITDA margins of more than 10 percent — in line with those of many of its peers — as well as the management team to grow big time in coming years.
Cafaro also said the Ventas team won't saddle the local company with a ton of debt, leaving it with "capacity to grow" in both its existing markets and beyond.
"We have already identified followup capital investments that will be value-creating," Cafaro said, adding that Ardent can increase both market share and margins in its New Mexico, Texas and Oklahoma markets. "This is huge opportunity for us over time."
Investors like the look of the Ardent deal and a planned spinoff of skilled nursing facilities Cafaro and her team also announced Monday morning. At about 2:20 p.m., Ventas shares (Ticker: VTR) were up almost 5 percent to $76.76, lifting the company's market capitalization to $24.2 billion.
Shares of HCA Holdings are on the list of 10 catalyst-driven picks for the second quarter at BofA Merrill Lynch. The firm's analysts say a favorable Supreme Court ruling in King vs. Burwell — which is expected by late June — will give the country's largest private hospital operator "plenty of upside possibility with little downside." HCA shares (Ticker: HCA) are up slightly so far this year.
Raymond James analysts have added AAC Holdings to their list of must-own health care stocks for the coming months. AAC (Ticker: AAC), which went public late last year, is down just a bit so far in 2015.
Our playbook for 2015 encompasses four key themes to invest behind: above-average growth (relative to peer groups), reform (which has been strong on the exchange front and could see a bump in Medicaid enrollment as more states expand Medicaid), capital deployment optionality, and free cash flow generation (the last two provide downside support and can act as incremental growth drivers).
And lastly for now, Sandler O'Neil analyst Stephen Scouten has lowered his rating on shares of Pinnacle Financial Partners (Ticker: PNFP) to 'hold' from 'buy' after they hit his $44 target. However, he has tweaked that target to $47.
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