Triad Tug of War

Depending on whom you talk to, Triad (TRI Quote) is either the opportunity of a lifetime or a disaster waiting to happen.

The hospital chain has tried to set itself apart with an aggressive growth strategy involving joint ventures with nonprofit hospitals and physician groups. But shares have fallen sharply over the last year and a half as the industry has been hit hard by rising nonpayment rates among uninsured patients, among other things.

Now some of the company's critics are starting to wonder when its expensive strategy will pay off. Triad's biggest holder, 6.2% owner TPG-Axon Capital Management, says in a recent filing that Triad "has spent all available funds on expansion, resulting in negative free cash flow and dilution to shareholders."

TPG-Axon wants the company to implement new controls, focus more on its existing assets and to start buying back its own stock. ...