Tenet Healthcare Q2 Earnings and Revenue Beat Estimates, Raises FY24 Guidance

Tenet Healthcare Corp. (NYSE: THC) reported a second-quarter profit of $259 million, or $2.64 per share, a significant increase from the $123 million, or $1.15 per share, reported in the same period last year. Adjusted earnings for the quarter were $226 million, or $2.31 per share. Revenue for the quarter rose slightly by 0.4% to $5.10 billion, up from $5.08 billion in the previous year.

The company has also updated its full-year 2024 earnings guidance, projecting earnings per share (EPS) in the range of $10.41 to $11.12, compared to the previous estimate of $8.81. Revenue guidance for the year is now between $20.6 billion and $21.0 billion, slightly above the consensus estimate of $20.39 billion. Several research firms, including Deutsche Bank, Wells Fargo, Cantor Fitzgerald, and Wolfe Research, have issued positive reviews for the company.

Tenet's strong performance led to a nearly 5% rise in its shares before markets opened. The company reported an earnings surprise of 22.22% for Q2, significantly beating the Zacks Consensus Estimate of $1.89 per share. Over the past four quarters, Tenet has consistently topped consensus revenue estimates. Since the beginning of the year, Tenet shares have surged by 83.5%, compared to a 16.5% gain for the S&P 500.

The company also reported a drop in total operating costs by 2.9% year-over-year, driven by increased net gains from the sale and consolidation of facilities. Despite a 4.3% decline in hospital operations and services revenue, Tenet exited the second quarter with cash and cash equivalents of $2.9 billion and total assets of $29.3 billion. For the third quarter of 2024, the company updated its EPS guidance to a range of $2.16 to $2.58, compared to the consensus estimate of $1.67. Analysts predict that Tenet will post an EPS of 8.87 for the current fiscal year.