Tenet Healthcare (THC) Stock Sinks As Market Gains: Here's Why

Tenet Healthcare (THC) closed the most recent trading day at $211.64, moving -3.49% from the previous trading session. The stock's change was less than the S&P 500's daily gain of 0.25%. Meanwhile, the Dow gained 0.1%, and the Nasdaq, a tech-heavy index, added 0.47%.

Prior to today's trading, shares of the hospital operator had lost 5.11% lagged the Medical sector's loss of 4.79% and the S&P 500's loss of 1.88%.

The investment community will be paying close attention to the earnings performance of Tenet Healthcare in its upcoming release. It is anticipated that the company will report an EPS of $4.19, marking a 3.9% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $5.39 billion, reflecting a 3.15% rise from the equivalent quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $17.3 per share and a revenue of $21.99 billion, representing changes of +3.1% and +3.21%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Tenet Healthcare. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.76% higher. Tenet Healthcare is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, Tenet Healthcare is currently trading at a Forward P/E ratio of 12.68. This expresses no noticeable deviation compared to the average Forward P/E of 12.68 of its industry.

We can also see that THC currently has a PEG ratio of 1.06. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. THC's industry had an average PEG ratio of 1.06 as of yesterday's close.

The Medical - Hospital industry is part of the Medical sector. This group has a Zacks Industry Rank of 56, putting it in the top 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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