HCA HEALTHCARE INC (HCA) Stock Fundamental Analysis
NYSE:HCA - New York Stock Exchange, Inc. - US40412C1018 - Common Stock - Currency: USD
Taking everything into account, HCA scores 5 out of 10 in our fundamental rating. HCA was compared to 102 industry peers in the Health Care Providers & Services industry. HCA scores excellent on profitability, but there are concerns on its financial health. HCA has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
HCA had positive earnings in the past year.
In the past year HCA had a positive cash flow from operations.
HCA had positive earnings in each of the past 5 years.
In the past 5 years HCA always reported a positive cash flow from operatings.
1.2 Ratios
HCA has a better Return On Assets (9.66%) than 94.12% of its industry peers.
With an excellent Return On Invested Capital value of 18.45%, HCA belongs to the best of the industry, outperforming 93.14% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HCA is significantly above the industry average of 9.53%.
The last Return On Invested Capital (18.45%) for HCA is above the 3 year average (17.59%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.66% | ||
| ROE | N/A | ||
| ROIC | 18.45% |
ROA(3y)9.92%
ROA(5y)10.28%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)17.59%
ROIC(5y)17.19%
1.3 Margins
HCA's Profit Margin of 8.07% is amongst the best of the industry. HCA outperforms 90.20% of its industry peers.
In the last couple of years the Profit Margin of HCA has grown nicely.
The Operating Margin of HCA (15.15%) is better than 90.20% of its industry peers.
HCA's Operating Margin has been stable in the last couple of years.
HCA's Gross Margin of 84.85% is amongst the best of the industry. HCA outperforms 97.06% of its industry peers.
HCA's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.15% | ||
| PM (TTM) | 8.07% | ||
| GM | 84.85% |
OM growth 3Y-3.21%
OM growth 5Y1.22%
PM growth 3Y-11.67%
PM growth 5Y3.63%
GM growth 3Y0.36%
GM growth 5Y0.31%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), HCA is creating value.
HCA has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, HCA has less shares outstanding
The debt/assets ratio for HCA is higher compared to a year ago.
2.2 Solvency
HCA has an Altman-Z score of 2.67. This is not the best score and indicates that HCA is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.67, HCA perfoms like the industry average, outperforming 58.82% of the companies in the same industry.
HCA has a debt to FCF ratio of 9.01. This is a negative value and a sign of low solvency as HCA would need 9.01 years to pay back of all of its debts.
HCA has a Debt to FCF ratio of 9.01. This is comparable to the rest of the industry: HCA outperforms 50.98% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 9.01 | ||
| Altman-Z | 2.67 |
ROIC/WACC2.39
WACC7.73%
2.3 Liquidity
HCA has a Current Ratio of 1.19. This is a normal value and indicates that HCA is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of HCA (1.19) is worse than 65.69% of its industry peers.
HCA has a Quick Ratio of 1.06. This is a normal value and indicates that HCA is financially healthy and should not expect problems in meeting its short term obligations.
HCA has a Quick ratio of 1.06. This is in the lower half of the industry: HCA underperforms 67.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.19 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.86% over the past year.
Measured over the past years, HCA shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.07% on average per year.
HCA shows a small growth in Revenue. In the last year, the Revenue has grown by 7.30%.
Measured over the past years, HCA shows a small growth in Revenue. The Revenue has been growing by 6.58% on average per year.
EPS 1Y (TTM)12.86%
EPS 3Y8.12%
EPS 5Y16.07%
EPS Q2Q%8.77%
Revenue 1Y (TTM)7.3%
Revenue growth 3Y6.32%
Revenue growth 5Y6.58%
Sales Q2Q%5.66%
3.2 Future
HCA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.18% yearly.
HCA is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.78% yearly.
EPS Next Y15.82%
EPS Next 2Y13.4%
EPS Next 3Y13.39%
EPS Next 5Y12.18%
Revenue Next Year5.99%
Revenue Next 2Y5.56%
Revenue Next 3Y5.45%
Revenue Next 5Y5.78%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 17.05 indicates a rather expensive valuation of HCA.
Based on the Price/Earnings ratio, HCA is valued a bit cheaper than the industry average as 73.53% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of HCA to the average of the S&P500 Index (26.60), we can say HCA is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 13.57, the valuation of HCA can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HCA indicates a somewhat cheap valuation: HCA is cheaper than 79.41% of the companies listed in the same industry.
HCA is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.43, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.05 | ||
| Fwd PE | 13.57 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HCA is valued a bit cheaper than 70.59% of the companies in the same industry.
67.65% of the companies in the same industry are more expensive than HCA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.21 | ||
| EV/EBITDA | 9.74 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
HCA has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as HCA's earnings are expected to grow with 13.39% in the coming years.
PEG (NY)1.08
PEG (5Y)1.06
EPS Next 2Y13.4%
EPS Next 3Y13.39%
5. Dividend
5.1 Amount
HCA has a yearly dividend return of 0.75%, which is pretty low.
HCA's Dividend Yield is rather good when compared to the industry average which is at 2.46. HCA pays more dividend than 82.35% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, HCA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
5.2 History
On average, the dividend of HCA grows each year by 10.63%, which is quite nice.
HCA has been paying a dividend for over 5 years, so it has already some track record.
HCA has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)10.63%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
HCA pays out 11.85% of its income as dividend. This is a sustainable payout ratio.
HCA's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP11.85%
EPS Next 2Y13.4%
EPS Next 3Y13.39%
386.05
-0.84 (-0.22%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners65.22%
Inst Owner Change-0.28%
Ins Owners1.22%
Ins Owner Change0%
Market Cap95.05B
Analysts76.67
Price Target381.5 (-1.18%)
Short Float %2.55%
Short Ratio2.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
Yearly Dividend2.68
Dividend Growth(5Y)10.63%
DP11.85%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.79%
Min EPS beat(2)-8.93%
Max EPS beat(2)10.52%
EPS beat(4)2
Avg EPS beat(4)3.56%
Min EPS beat(4)-8.93%
Max EPS beat(4)12.83%
EPS beat(8)5
Avg EPS beat(8)5.73%
EPS beat(12)8
Avg EPS beat(12)5.75%
EPS beat(16)10
Avg EPS beat(16)6.81%
Revenue beat(2)0
Avg Revenue beat(2)-0.64%
Min Revenue beat(2)-0.7%
Max Revenue beat(2)-0.59%
Revenue beat(4)1
Avg Revenue beat(4)-0.24%
Min Revenue beat(4)-1.28%
Max Revenue beat(4)1.6%
Revenue beat(8)5
Avg Revenue beat(8)0.89%
Revenue beat(12)6
Avg Revenue beat(12)0.41%
Revenue beat(16)9
Avg Revenue beat(16)0.73%
PT rev (1m)-0.82%
PT rev (3m)-1.44%
EPS NQ rev (1m)-0.59%
EPS NQ rev (3m)-0.77%
EPS NY rev (1m)1.8%
EPS NY rev (3m)1.91%
Revenue NQ rev (1m)0.37%
Revenue NQ rev (3m)0.38%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)0.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.05 | ||
| Fwd PE | 13.57 | ||
| P/S | 1.33 | ||
| P/FCF | 19.21 | ||
| P/OCF | 9.8 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.74 |
EPS(TTM)22.64
EY5.86%
EPS(NY)28.45
Fwd EY7.37%
FCF(TTM)20.1
FCFY5.21%
OCF(TTM)39.38
OCFY10.2%
SpS290.76
BVpS-14.29
TBVpS-55.87
PEG (NY)1.08
PEG (5Y)1.06
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.66% | ||
| ROE | N/A | ||
| ROCE | 23.48% | ||
| ROIC | 18.45% | ||
| ROICexc | 18.89% | ||
| ROICexgc | 24.43% | ||
| OM | 15.15% | ||
| PM (TTM) | 8.07% | ||
| GM | 84.85% | ||
| FCFM | 6.91% |
ROA(3y)9.92%
ROA(5y)10.28%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)17.59%
ROIC(5y)17.19%
ROICexc(3y)18.13%
ROICexc(5y)17.79%
ROICexgc(3y)23.68%
ROICexgc(5y)23.27%
ROCE(3y)22.39%
ROCE(5y)21.88%
ROICexcg growth 3Y0.58%
ROICexcg growth 5Y5.14%
ROICexc growth 3Y0.68%
ROICexc growth 5Y4.8%
OM growth 3Y-3.21%
OM growth 5Y1.22%
PM growth 3Y-11.67%
PM growth 5Y3.63%
GM growth 3Y0.36%
GM growth 5Y0.31%
F-Score8
Asset Turnover1.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 9.01 | ||
| Debt/EBITDA | 2.89 | ||
| Cap/Depr | 140.6% | ||
| Cap/Sales | 6.63% | ||
| Interest Coverage | 5.59 | ||
| Cash Conversion | 68.19% | ||
| Profit Quality | 85.62% | ||
| Current Ratio | 1.19 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | 2.67 |
F-Score8
WACC7.73%
ROIC/WACC2.39
Cap/Depr(3y)149.8%
Cap/Depr(5y)135.79%
Cap/Sales(3y)7.17%
Cap/Sales(5y)6.62%
Profit Quality(3y)86.82%
Profit Quality(5y)101.65%
High Growth Momentum
Growth
EPS 1Y (TTM)12.86%
EPS 3Y8.12%
EPS 5Y16.07%
EPS Q2Q%8.77%
EPS Next Y15.82%
EPS Next 2Y13.4%
EPS Next 3Y13.39%
EPS Next 5Y12.18%
Revenue 1Y (TTM)7.3%
Revenue growth 3Y6.32%
Revenue growth 5Y6.58%
Sales Q2Q%5.66%
Revenue Next Year5.99%
Revenue Next 2Y5.56%
Revenue Next 3Y5.45%
Revenue Next 5Y5.78%
EBIT growth 1Y11.17%
EBIT growth 3Y2.91%
EBIT growth 5Y7.88%
EBIT Next Year38.74%
EBIT Next 3Y15.45%
EBIT Next 5Y11.37%
FCF growth 1Y16.45%
FCF growth 3Y1.57%
FCF growth 5Y10.36%
OCF growth 1Y7.97%
OCF growth 3Y5.48%
OCF growth 5Y6.7%