THC
Tenet Healthcare Corp
Healthcare
05/26/2015
Presented
| Date | 05/20/2015 |
| Price | $51.81 |
| Market Cap | N/A |
| Ent Value | $17.63B |
| P/E Ratio | 48.7x |
| Book Value | $8.46 |
| Div Yield | N/A |
| Shares O/S | 99.22M |
| Ave Daily Vol | 1,670,000 |
| Short Int | 7.44% |
Current
| Price | $160.25 |
| Market Cap | $15.36B |
| Tenet Healthcare Corporation, a healthcare services company, primarily operates acute care hospitals and related healthcare facilities in the United States. It operates through two segments, Hospital Operations and Other, and Conifer. The company’s general hospitals offer acute care services, operating and recovery rooms, radiology services, respiratory therapy services, clinical laboratories, and pharmacies. It also provides intensive care, critical care and/or coronary care units, physical therapy, orthopedic, oncology, and outpatient services; tertiary care services, including open-heart surgery, neonatal intensive care, and neurosciences; quaternary care services in the areas of heart, liver, kidney, and bone marrow transplants; quaternary pediatric and burn services; advanced treatment options for patients; gamma-knife brain surgery; cyberknife radiation therapy for tumors and lesions in the brain, lung, neck, and spine; and outpatient services. In addition, the company offers clinical research programs related to cardiovascular disease, pulmonary disease, musculoskeletal disorders, neurological disorders, genitourinary disease, and various cancers, as well as drug and medical device studies. Further, it provides operational management for patient access, health information management, revenue integrity, and patient financial services; communications and engagement solutions to optimize the relationship between providers and patients; and management services comprising clinical integration, financial risk management, and population health management. As of December 31, 2014, the company operated 80 hospitals with 20,814 beds; 210 outpatient centers; 6 health plans; 11 accountable care networks; and Conifer Health Solutions, LLC that offers business process solutions to approximately 800 hospital and other clients. Tenet Healthcare Corporation was founded in 1967 and is headquartered in Dallas, Texas. |
Publicly traded companies mentioned herein: Community Health Systems (CYH), HCA Holdings Inc (HCA), Tenet Healthcare Corp (THC), Ventas Inc (VTR)
Highlights
The presenter is long shares of Tenet Healthcare (THC) because he sees the potential for an “outsize return” to be made on a real estate monetization play. At current levels ($51 - $52) THC’s market cap is ~$5.1 billion, which is just ~$800 million more than it paid for Vanguard in 2013 ($4.3 billion, including $2.5 billion of debt). However, the hospital system nearly doubled in size following the deal, and the recently announced acquisition of privately held Ardent by Ventas suggests there may be value to be unlocked.
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