Why Tenet Health (THC) Is Down Today

NEW YORK (TheStreet) -- Tenet Healthcare  (THC) was falling 9.7% to $43.65 on Tuesday after the company reported a net loss in the fourth quarter chiefly due to financing its acquisition of Vanguard Health Systems, a smaller chain of hospitals.

Tenet purchased Vanguard last fall for $1.8 billion in order to reach into new markets and to benefit from an increase in patients with health insurance under President Barack Obama's healthcare reform. The company announced its adjusted admissions, which include both inpatient and outpatient data, fell 0.5% in the fourth quarter, while inpatient admissions fell 2.3%.

The company report income from continuing operations of $43 million, or 43 cents a share, excluding items, down from $65 million, or 60 cents a share, in the same period one year earlier. Analysts expected a profit of 34 cents a share, according to Thomson Reuters I/B/E/S. The company reported a net loss of $24 million, or 24 cents a share, down year over year from a net income of $49 million, or 45 cents a share. Net operating revenue increased 67% to $3.89 billion. Adjusted EBITDA, excluding items, increased 32.1% year over year to $444 million from $336 million.

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TheStreet Ratings team rates TENET HEALTHCARE CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate TENET HEALTHCARE CORP (THC) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, growth in earnings per share and revenue growth. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity."

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