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Tenet Healthcare Corp
THC : NYSE : Health Care
$45.16 | %
Today's Range: 44.46 - 45.44
Avg. Daily Volume: 1,588,200
07/11/14 - 4:03 PM ET

Financial Analysis


TENET HEALTHCARE CORP's gross profit margin for the first quarter of its fiscal year 2014 has decreased when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth. TENET HEALTHCARE CORP has weak liquidity. Currently, the Quick Ratio is 0.69 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 24.87% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY14 Q1 FY13
Net Sales ($mil)3926.02387.0
EBITDA ($mil)387.0274.0
EBIT ($mil)194.0160.0
Net Income ($mil)-32.0-88.0


Balance Sheet Q1 FY14 Q1 FY13
Cash & Equiv. ($mil)141.095.0
Total Assets ($mil)16484.08915.0
Total Debt ($mil)11234.05427.0
Equity ($mil)728.0969.0


Profitability Q1 FY14 Q1 FY13
Gross Profit Margin9.8611.48
EBITDA Margin9.8511.47
Operating Margin4.946.7
Sales Turnover0.771.03
Return on Assets-0.470.0
Return on Equity-8.794.33
Debt Q1 FY14 Q1 FY13
Current Ratio1.191.58
Debt/Capital0.940.85
Interest Expense182.0103.0
Interest Coverage1.071.55


Share Data Q1 FY14 Q1 FY13
Shares outstanding (mil)97.59103.43
Div / share0.00.0
EPS-0.28-0.83
Book value / share7.469.37
Institutional Own % n/a n/a
Avg Daily Volume1630110.01927333.0

Valuation


HOLD. This stock?s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. For additional comparison, its price-to-book ratio of 6.41 indicates a significant premium versus the S&P 500 average of 2.72 and a significant premium versus the industry average of 3.10. The current price-to-sales ratio is well below the S&P 500 average and is also below the industry average, indicating a discount. After reviewing these and other key valuation criteria, TENET HEALTHCARE CORP proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
THC NM Peers 27.83   THC 7.72 Peers 17.83

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

THC's P/E is negative making this valuation measure meaningless.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

THC is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
THC 18.99 Peers 19.75   THC NA Peers 7.06

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

THC is trading at a significant premium to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
THC 6.41 Peers 3.10   THC -275.67 Peers 94.05

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

THC is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, THC is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
THC 0.37 Peers 0.76   THC 37.34 Peers 10.50

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

THC is trading at a significant discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

THC has a sales growth rate that significantly exceeds its peers.

 

 

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