HCA Healthcare Q2 revenue rises on Medicaid programs; narrows outlook

Overview

• US hospital operator's Q2 revenue rose 8.7% yr/yr; adjusted EPS up 11%

• Company saw negative impact from payer mix shift, partly offset by Medicaid program benefits

• HCA repurchased 4.75 mln shares for $2.06 bln in Q2

Outlook

• HCA Healthcare lowers 2026 net income outlook to $6.3 bln-$6.7 bln from $6.495 bln-$7.035 bln

• Company now sees 2026 revenues of $77 bln-$79.5 bln, versus prior $76.5 bln-$80 bln range

• HCA expects 2026 adjusted EBITDA of $15.4 bln-$16.1 bln, down from $15.55 bln-$16.45 bln prior

Result Drivers

• PAYER MIX SHIFT - Co said increase in uninsured patients, mainly from loss of health exchange coverage, negatively impacted results by about $400 mln

• MEDICAID PROGRAMS - Incremental net benefit from Medicaid Supplemental Payment Programs, mainly Florida, helped offset negative factors

• SERVICE MIX SHIFT - Decline in surgical volume contributed to a less favorable service mix

Company press release: ID:nBw4rJZf9a

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 14 "strong buy" or "buy", 11 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the healthcare facilities services peer group is "buy"

• Wall Street's median 12-month price target for HCA Healthcare Inc is $462.50, about 22.8% above its July 23 closing price of $376.50

• The stock recently traded at 12 times the next 12-month earnings vs. a P/E of 15 three months ago

Reuters Recommended Reads

• July 23 - Tenet Healthcare Q2 revenue beats estimates on same-facility system growth; FY 2026 outlook raised

• July 22 - Molina's profit forecast lift overshadowed by Obamacare weakness

• July 23 - Edwards Lifesciences Q2 sales beat estimates, supported by sustained clinical momentum; shares up

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)