NEW YORK (TheStreet) -- Shares of Tenet Healthcare (THC) were gaining 11.8% to $56 on heavy trading volume after the Supreme Court ruled the federal government can continue issuing subsidies to Americans through the Affordable Care Act, also known as Obamacare.
In a 6-3 decision, the Court ruled that the U.S. government can provide subsidies to Americans living in states that did not set up their own health insurance exchanges through the ACA. "Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them," Chief Justice Roberts wrote for the court.
About 6.5 million American could have lost their credits for healthcare if the Supreme Court ruled against the ACA, according to the Wall Street Journal.
Shares of hospitals such as Tenet Healthcare gained following the ruling as the ACA helps patients pay for their care.
About 4.3 million shares of Tenet Healthcare were traded by 10:46 a.m. Thursday, above the company's average trading volume of about 1.5 million shares a day.
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 impressive record of earnings per share growth, compelling growth in net income and revenue growth. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, weak operating cash flow and poor profit margins."