HCA Healthcare stock price approaches all-time high after 4th quarter earnings report
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ASHEVILLE – HCA Healthcare’s stock price is approaching an all-time high after a fourth-quarter earnings report, released Jan. 30. The company earned $1.6 billion in profits during the quarter, bringing in $17.3 billion in revenues.
HCA, a Nashville-based for-profit, publicly traded health care conglomerate, bought the Mission Health system in 2019 for $1.5 billion. Since the company bought the system, patients, doctors and hospital staff have decried deteriorating care at the hands of the corporate owner.
In December, these complaints turned to legal action. North Carolina Attorney General and gubernatorial candidate Josh Stein filed a lawsuit against HCA, alleging that the company broke the promises it made when it bought the hospital system. Stein is requesting the court demand HCA return quality of care to its pre-sale state.
That lawsuit is a bug on HCA’s windshield.
UNC Asheville Assistant Professor of Economics Muhammad Nawaz told the Citizen Times Jan. 30 that shareholders factor risks and HCA's response to those risks when they choose to buy HCA stocks. The health care system is also so important that regulators will not allow it to default, which builds confidence in investors, Nawaz said.
Nawaz also noted that the Mission Health system is such a small part of the company’s portfolio, which includes 183 hospitals and roughly 2,300 other patient care sites, that the legal action brought by Stein minimally impacts HCA’s stock price.
The company’s stock price increased 5.18% during the day after the quarterly report became available, closing at $301.59 dollars per share. HCA’s all-time stock price high was $304.86, which it reached in June.
“We finished 2023 better than expected across most dimensions of our business,” HCA Chief Executive Officer Sam Hazen said during the quarterly conference call. “End of quarter, we experienced strong demand for services across our diversified portfolio of markets, facilities and service lines.”
Nawaz attributes the excitement from shareholders to strong revenue numbers and a health care sector that investors believe is primed for growth. Earnings that exceeded analysts’ projections led to the stock pricing increasing, but Nawaz said that was a smaller factor.
According to Yahoo Finance, analysts estimated HCA’s fourth-quarter revenue and earnings would reach $16.5 billion and $5.06 per share respectively. The company’s actual revenue beat projections by about $780 million. Earnings beat analysts’ projections by $0.87 per share. Earnings are a measure of a company's profitability.
Same facility admissions increased 3.1% for HCA compared to the same period in 2022. This included increases to emergency room visits, inpatient and outpatient surgeries.
More: Mission Hospital to implement new ambulance patient handoff policy. HCA gives no details.
Expenses grew faster than revenues. HCA brought in $65 billion in revenue in 2023 and $60.2 billion and 2022. Net income fell by 1.3% during that time as operating expenses not related to employee earnings and supplies increased.
HCA Chief Financial Officer Bill Rutherford, who will retire in May, mentioned that the company earned roughly $250 million more in supplemental payments year over year. He said that this money includes the “new North Carolina program.”
More: Judge denies HCA contractor TeamHealth motion to dismiss in Buncombe County lawsuit
More: Asheville independent hospital monitor to increase oversight; monitor oversees HCA
North Carolina became the 40th state to expand Medicaid in December, making roughly 600,000 more people eligible for health insurance.
The fourth quarter earnings report is a rebound from the previous quarter’s report, which sent the company’s stock price tumbling. HCA’s stock price fell $10.53 the day the third quarter earnings report became available. The company’s stock hit $230.06, its lowest point since November 2022.
HCA collected $300 million less revenue than during the same period of 2022. The loss was created by a failed staffing venture, increases in fees for contract workers and changes in supplemental pay programs.
Mitchell Black covers Buncombe County and health care for the Citizen Times. Email him at mblack@citizentimes.com or follow him on Twitter @MitchABlack. Please help support local journalism with a subscription to the Citizen Times.
This article originally appeared on Asheville Citizen Times: HCA stock price approaches all-time high after 4th quarter earnings
