What's In Store For HCA Healthcare's (HCA) Q1 Earnings?
Zacks Investment Research | Apr 25, 2019 11:42PM ET
HCA Healthcare, Inc. (NYSE:HCA) is scheduled to release first-quarter 2019 results on Apr 30. In the last reported quarter, the company delivered a positive surprise of nearly 15.4%, backed by higher same facility admissions. Moreover, the bottom line shot up nearly 41% year over year.
Let’s see, how things are shaping up prior to this announcement.
A likely increase in beds, admissions and patient days should aid revenue growth in the to-be-reported quarter. The Zacks Consensus Estimate for first-quarter revenues stands at $12.3 billion, indicating 7.8% growth from the year-ago reported figure. The Zacks Consensus Estimate for equivalent admissions is pegged at 879 million, implying3.5% increase from the year-earlier quarter’s reported figure. This uptick would likely be backed by the company’s network expansion.
The Zacks Consensus Estimate for patient days has also been revised 2.7% upward from the year-ago quarter’s reported figure. Moreover, the consensus mark for weighted average licensed beds has moved2.4% north from the prior-year’s reported number.
The consensus estimate for the total number of hospitals is likely to be raised2.2% from the reported tally in the same period last year.
The company might have been consistent with capital deployment, which should further favor its bottom line.
HCA Healthcare has likely witnessed a steady cash flow in the first quarter, retaining the momentum over the last several quarters.
However, the Zacks Consensus Estimate for earnings in the to-be-reported quarter is pegged at $2.31, suggesting a 0.9% dip from the year-ago reported figure. This downside is most likely due to higher expenses because of the company’s growth-related investments and operating costs. Higher expenses should also weigh on the company’s margins.
Further, we expect the company's leverage ratio to persistently deteriorate as it incurs more debt to finance its acquisitions.
What the Quantitative Model States
The proven Zacks model does not conclusively show that HCA Healthcare is likely to beat on earnings this to-be-reported quarter. This is because the stock needs to have the right combination of a positive Zacks Investment Research
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