UBS analysts, in a note to clients, believe Tenet Healthcare (NYSE:THC) delivered on high expectations during its second quarter of 2023, managed contract nursing and physician subsidies costs well, and is still most likely to outperform numbers in the back half of the year among core hospital peers.
They maintained their ‘Buy’ rating on the stock but boosted their 12-month target price to $104 per share from $95.
And despite the company raising its 2023 adjusted EBITDA guidance, the analysts see “clear upside potential” to the numbers, particularly in the ambulatory surgical cases segment, where underlying trends are meaningfully better than the initial outlook and support organic growth in the 8% range.
The analysts at UBS added that their bullish outlook is driven largely by higher ambulatory surgical case growth and significantly lower contract labor cost.
Shares of Tenet Healthcare (NYSE:THC) rose 2.5% to $76.61 in late-afternoon trading on Tuesday while gaining 56% year to date.
Contact Sean at sean@proactiveinvestors.com