On Tuesday, Tenet Healthcare Corporation ( THC )  reported third-quarter sales of $5.12 billion, up around 1.1% year over year, beating the consensus of $5.05 billion and management guidance of $5 billion—$5.1 billion.

Tenet Healthcare ( THC ) operates hospitals and healthcare facilities.

The company reported adjusted EPS of $2.93, up from $1.44 a year ago, beating the guidance of $2.16-$2.58 and the consensus of $2.37.

“Our businesses continue to produce strong results and generate robust free cash flow with same-store revenue growth and profitability well above our expectations due to the focused execution of our strategy and disciplined operations,” said Saum Sutaria, Chairman and CEO of Tenet.

Adjusted EBITDA was $978 million compared to $854 million a year ago, reflecting strong same-hospital admissions growth, ambulatory net revenue per case growth, favorable payer mix, and increased Medicaid supplemental revenues in Michigan.

Tenet’s free cash flow was $1.78 billion for the nine months ended September 30, 2024, up 76% year over year.

Ambulatory segment revenues increased 21% to $1.14 billion, driven by net revenue per case growth, facility acquisitions, and increased service lines.

Surgical business same-facility system-wide net patient service revenues increased 8.7%, with cases up 1.0% and net revenue per case up 7.6%.

Hospital Operations and Services revenues declined 3.4% to $3.98 billion, primarily due to the impact of hospital divestitures in the first quarter of 2024. This was partially offset by strong same-hospital admissions growth, favorable payer mix, and improved pricing yield.

Same-hospital net patient service revenue per adjusted admission increased 3.3% year-over-year.

In October, the company completed the sale of its 70% majority ownership interest in Brookwood Baptist Health in Birmingham, Alabama, to Orlando Health. The completed transaction included five hospitals and other related operations.

Outlook: Tenet Healthcare ( THC ) revised its fiscal year 2024 revenues guidance to $20.6 billion—$20.8 billion, compared to prior guidance of $20.6 billion—$21 billion and the consensus of $20.82 billion.

The guidance includes Hospital segment sales of $16.225 billion —$16.375 billion and Ambulatory Segment sales of $4.375 billion—$4.425 billion, compared to prior guidance of $16.28 billion—$16.53 billion and $4.33 billion—$4.48 billion, respectively.

The company forecasts adjusted EPS of $11.12-$11.73 compared to prior guidance of $10.41-$11.12 and a consensus of $10.56.

Price Action: At last check on Tuesday, THC stock was up 12.01% at $156.18.

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