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1. Company Snapshot

1.a. Company Description

Tenet Healthcare Corporation operates as a diversified healthcare services company.The company operates in three segments: Hospital Operations and Other, Ambulatory Care, and Conifer.Its general hospitals offer acute care services, operating and recovery rooms, radiology and respiratory therapy services, clinical laboratories, and pharmacies.


The company also provides intensive and critical care, and coronary care units; cardiovascular, digestive disease, neurosciences, musculoskeletal, and obstetrics services; outpatient services, including physical therapy; cardiothoracic surgery, complex spinal surgery, neonatal intensive care, and neurosurgery services; quaternary care services in heart and kidney transplants; and limb-salvaging vascular procedure, acute level 1 trauma, intravascular stroke care, minimally invasive cardiac valve replacement, imaging, and telemedicine access services.In addition, it operates ambulatory surgery and urgent care centers, imaging centers, surgical hospitals, off-campus emergency departments, and micro-hospitals; and offers healthcare business process services in the areas of hospital and physician revenue cycle management, patient communications and engagement support, and value-based care solutions to hospitals, health systems, physician practices, employers, and other customers.As of February 09, 2022, the company operated 60 hospitals; and approximately 550 other healthcare facilities, including surgical hospitals, ambulatory surgery centers, urgent care and imaging centers, and other care sites and clinics.


Tenet Healthcare Corporation was incorporated in 1975 and is headquartered in Dallas, Texas.

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1.b. Last Insights on THC

Tenet Healthcare Corporation's recent performance has been driven by strong Q3 earnings, beating estimates with higher revenues and segment growth. Additionally, institutional investors have shown confidence in the company, with Creative Planning raising its holdings by 7.4% and Boston Partners acquiring 1,104,500 shares, a 95% increase. These acquisitions suggest a positive outlook for the company's future prospects. Furthermore, the company's upgraded outlook and discounted valuation have been highlighted as key growth drivers.

1.c. Company Highlights

2. Tenet Healthcare's Q3 2025 Earnings: Strong Revenue and EBITDA Growth

Tenet Healthcare reported net operating revenues of $5.3 billion for the third quarter of 2025, with consolidated adjusted EBITDA growing 12% to $1.1 billion, representing an adjusted EBITDA margin of 20.8%. The company's earnings per share (EPS) came in at $3.7, beating analyst estimates of $3.33. USPI's adjusted EBITDA grew 12% to $492 million, driven by 8.3% same-facility revenue growth, while the hospital segment adjusted EBITDA grew 13% to $607 million.

Publication Date: Oct -30

📋 Highlights
  • Strong Revenue & Margin Growth: Q3 net operating revenue reached $5.3B, with consolidated adjusted EBITDA rising 12% to $1.1B (20.8% margin), driven by 13% growth in hospital segment EBITDA ($607M) and 12% in USPI ($492M).
  • Full-Year Guidance Raised: Adjusted EBITDA guidance lifted to $4.47B–$4.57B, free cash flow to $1.495B–$1.695B, and capital expenditures increased to $875M–$975M, reflecting operational confidence.
  • Aggressive M&A & Share Buybacks: Spent $300M on ASC acquisitions YTD, plans for Q4 expansion, and repurchased 598K shares for $93M in Q3, signaling strategic growth and shareholder value prioritization.
  • Positive Operational Metrics: ASC volumes grew via higher acuity services and robotics, hospital outpatient demand remained strong, and supplemental Medicaid revenue added $346M in Q3 ($1.02B YTD).

Guidance Raise and Capital Allocation

The company raised its full-year 2025 adjusted EBITDA guidance to $4.47 billion to $4.57 billion and increased its capital expenditure guidance to $875 million to $975 million. Tenet also raised its free cash flow guidance for 2025 to $1.495 billion to $1.695 billion. The company has been active in M&A, spending nearly $300 million on ambulatory surgery center acquisitions year-to-date and expects to continue adding centers in the fourth quarter.

Operational Performance

Tenet's labor costs have been well-managed, with no meaningful changes expected in the near term. The company has optimized its sourcing and contract structures to mitigate inflationary pressures. Conifer's contribution within the hospital operations segment is performing well, with capabilities to assist with patient eligibility and enrollment services. ASC volumes are positive, driven by growth in higher acuity services, robotics, and healthier GI recovery.

Valuation and Outlook

With a P/E Ratio of 11.56 and an EV/EBITDA of 4.17, Tenet's valuation appears reasonable. The company's ROE is 39.49%, indicating strong profitability. Analysts estimate revenue growth of 4.5% for next year. Tenet's leverage ratio is 2.3x EBITDA, and the company repurchased 598,000 shares of its stock for $93 million in the third quarter. The company's business transformation initiative is expected to drive savings and contingency planning.

Regulatory Environment

The finalization of the hospital outpatient rule and potential removal of the inpatient-only list could be a net positive for Tenet, particularly for the USPI segment, with potential for more volumes to shift to the outpatient setting. The company is well-positioned to manage the impact of the Wiser model in fee-for-service Medicare.

3. NewsRoom

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Tenet Healthcare's Surge Isn't Over Yet

Dec -04

Source: seekingalpha.com

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Tenet Healthcare Soars 72% YTD: But is the Rally Out of Breath?

Dec -01

Source:

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Boston Partners Acquires 1,104,500 Shares of Tenet Healthcare Corporation $THC

Nov -26

Source: defenseworld.net

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Larry Robbins' Strategic Acquisition of Butterfly Network Inc. Shares

Nov -25

Source: gurufocus.com

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Tenet Healthcare Corporation $THC Shares Acquired by Creative Planning

Nov -25

Source: defenseworld.net

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Larry Robbins Reduces Stake in Tenet Healthcare Corp by 20.69%, Impacting Portfolio by -2.99%

Nov -14

Source: gurufocus.com

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Market Today: Stocks Slide, Boeing deal, Disney-YouTube TV fight

Nov -13

Source: gurufocus.com

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Tenet Healthcare Shares Down 5% Despite Q3 Earnings Beat

Nov -10

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.37%)

6. Segments

Hospital Operations

Expected Growth: 4.73%

Tenet Healthcare Corporation's Hospital Operations segment growth of 4.73% is driven by increasing patient volumes, strategic acquisitions, and cost savings initiatives. Additionally, the company's focus on improving operational efficiencies, expanding its ambulatory care services, and investing in digital healthcare technologies have contributed to the segment's growth.

Ambulatory Care

Expected Growth: 8.15%

Tenet Healthcare's Ambulatory Care segment growth of 8.15% is driven by increasing demand for outpatient services, strategic acquisitions, and expansion of service lines. Additionally, the company's focus on value-based care and population health management, as well as investments in digital health and technology, contribute to the segment's growth.

7. Detailed Products

Hospital Services

Tenet Healthcare Corporation operates a network of hospitals that provide a range of medical services, including emergency care, surgical services, and rehabilitation programs.

Outpatient Services

Tenet offers outpatient services, including urgent care, imaging, and physical therapy, providing convenient and accessible care to patients.

Physician Services

Tenet partners with physicians to provide high-quality medical care, including primary care, specialty care, and surgical services.

Ambulatory Surgery Centers

Tenet operates ambulatory surgery centers that provide outpatient surgical services, including orthopedic, ophthalmology, and general surgery procedures.

Conifer Health Solutions

Conifer Health Solutions, a subsidiary of Tenet, provides revenue cycle management, patient engagement, and value-based care solutions to healthcare providers.

8. Tenet Healthcare Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Tenet Healthcare Corporation faces moderate threat from substitutes, as patients have limited alternatives for hospital services, but some outpatient procedures can be substituted with ambulatory surgery centers or urgent care centers.

Bargaining Power Of Customers

Tenet Healthcare Corporation has a low bargaining power of customers, as individual patients have limited negotiating power, but large employers and insurance companies may have some bargaining power.

Bargaining Power Of Suppliers

Tenet Healthcare Corporation faces moderate bargaining power of suppliers, as it relies on a few large suppliers for medical equipment and pharmaceuticals, but has some negotiating power due to its large scale.

Threat Of New Entrants

Tenet Healthcare Corporation faces a low threat of new entrants, as entering the hospital industry requires significant capital investment and regulatory approvals, creating barriers to entry.

Intensity Of Rivalry

Tenet Healthcare Corporation operates in a highly competitive industry, with many hospitals and health systems competing for patients, physicians, and market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 90.37%
Debt Cost 6.85%
Equity Weight 9.63%
Equity Cost 14.34%
WACC 7.58%
Leverage 938.18%

11. Quality Control: Tenet Healthcare Corporation passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Encompass Health

A-Score: 5.7/10

Value: 3.8

Growth: 5.1

Quality: 7.0

Yield: 1.0

Momentum: 8.5

Volatility: 8.7

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Tenet Healthcare

A-Score: 5.2/10

Value: 6.3

Growth: 6.8

Quality: 5.5

Yield: 0.0

Momentum: 7.5

Volatility: 5.3

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Ensign Group

A-Score: 5.0/10

Value: 2.0

Growth: 7.6

Quality: 4.4

Yield: 0.0

Momentum: 7.0

Volatility: 9.0

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DaVita

A-Score: 4.8/10

Value: 8.2

Growth: 7.0

Quality: 4.8

Yield: 0.0

Momentum: 2.0

Volatility: 7.0

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Chemed

A-Score: 4.2/10

Value: 2.9

Growth: 6.1

Quality: 7.3

Yield: 0.0

Momentum: 1.0

Volatility: 7.7

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Select Medical

A-Score: 3.8/10

Value: 6.8

Growth: 4.3

Quality: 2.5

Yield: 3.0

Momentum: 1.0

Volatility: 5.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

210.0$

Current Price

210$

Potential

-0.00%

Expected Cash-Flows