Tenet Healthcare (THC) Stock Forecast & Price Target

Tenet Healthcare demonstrated strong financial performance, with same-facility revenue growth of 7.7% year-over-year, significantly exceeding its long-term target of 4%-6%, driven by a favorable case mix and an 8.3% increase in net revenue per case. Furthermore, the organization's focus on managing elevated denials and disputes through technology and offshore staffing is indicative of its proactive approach to operational efficiency, which bodes well for future profitability. The substantial 23% year-over-year growth in Health Insurance Exchange (HIX) volume and a 28% increase in HIX revenue further underscore the company's robust demand and successful adaptation to market dynamics.

Tenet Healthcare faces significant risks that contribute to a negative stock outlook, primarily due to the anticipated expiration of the enhanced advance premium tax credits (eAPTCs) at the end of 2025, which could lead to an estimated EBITDA headwind of approximately $354 million. Additionally, there are concerns regarding underwhelming hospital volumes that challenge the company's high-acuity strategy, compounded by a lack of management commentary on critical industry impacts during recent earnings calls. Lastly, various factors such as declining enrollment in the Health Insurance Marketplace, increasing inflationary cost pressures, and rising labor supply issues threaten both top-line growth and overall financial stability.