Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
-- HCA Holdings
) has been reiterated by TheStreet Ratings as a sell with a ratings score of D+. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, poor profit margins and weak operating cash flow.
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Highlights from the ratings report include:
- HCA HOLDINGS INC's earnings per share declined by 37.3% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, HCA HOLDINGS INC reported lower earnings of $3.49 versus $5.31 in the prior year. For the next year, the market is expecting a contraction of 10.3% in earnings ($3.13 versus $3.49).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Health Care Providers & Services industry. The net income has significantly decreased by 36.3% when compared to the same quarter one year ago, falling from $540.00 million to $344.00 million.
- The gross profit margin for HCA HOLDINGS INC is rather low; currently it is at 18.00%. It has decreased from the same quarter the previous year. Regardless of the weak results of the gross profit margin, the net profit margin of 4.07% is above that of the industry average.
- Net operating cash flow has declined marginally to $740.00 million or 7.15% when compared to the same quarter last year. Despite a decrease in cash flow HCA HOLDINGS INC is still fairing well by exceeding its industry average cash flow growth rate of -41.10%.
- HCA's revenue growth trails the industry average of 13.2%. Since the same quarter one year prior, revenues slightly increased by 0.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
HCA Holdings, Inc., through its subsidiaries, provides health care services in the United States. HCA has a market cap of $16.6 billion and is part of the health care sector and health services industry. The company has a P/E ratio of 12.00, below the S&P 500 P/E ratio of 18.00. Shares are up 23.6% year to date as of the close of trading on Thursday.
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--Written by a member of TheStreet Ratings Staff.
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