Tenet Healthcare Corporation
Tenet Healthcare Corporation Fundamental Analysis
Tenet Healthcare Corporation (THC) shows moderate financial fundamentals with a PE ratio of 14.82, profit margin of 6.60%, and ROE of 34.82%. The company generates $21.3B in annual revenue with weak year-over-year growth of 0.57%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 49.3/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze THC's fundamental strength across five key dimensions:
Efficiency Score
WeakTHC struggles to generate sufficient returns from assets.
Valuation Score
ModerateTHC shows balanced valuation metrics.
Growth Score
WeakTHC faces weak or negative growth trends.
Financial Health Score
ModerateTHC shows balanced financial health with some risks.
Profitability Score
ModerateTHC maintains healthy but balanced margins.
Key Financial Metrics
Is THC Expensive or Cheap?
P/E Ratio
THC trades at 14.82 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, THC's PEG of 2.39 indicates potential overvaluation.
Price to Book
The market values Tenet Healthcare Corporation at 4.94 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 2.36 times EBITDA. This is generally considered low.
How Well Does THC Make Money?
Net Profit Margin
For every $100 in sales, Tenet Healthcare Corporation keeps $6.60 as profit after all expenses.
Operating Margin
Core operations generate 16.46 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $34.82 in profit for every $100 of shareholder equity.
ROA
Tenet Healthcare Corporation generates $4.74 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Tenet Healthcare Corporation produces operating cash flow of $3.54B, showing steady but balanced cash generation.
Free Cash Flow
Tenet Healthcare Corporation generates strong free cash flow of $2.53B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $28.78 in free cash annually.
FCF Yield
THC converts 12.13% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
14.82
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.39
vs 25 benchmark
P/B Ratio
Price to book value ratio
4.94
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.98
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
3.12
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.76
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.35
vs 25 benchmark
ROA
Return on assets percentage
0.05
vs 25 benchmark
ROCE
Return on capital employed
0.14
vs 25 benchmark
How THC Stacks Against Its Sector Peers
| Metric | THC Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 14.82 | 29.45 | Better (Cheaper) |
| ROE | 34.82% | 779.00% | Weak |
| Net Margin | 6.60% | -24936.00% (disorted) | Weak |
| Debt/Equity | 3.12 | 0.26 | Weak (High Leverage) |
| Current Ratio | 1.76 | 4.65 | Neutral |
| ROA | 4.74% | -19344.00% (disorted) | Weak |
THC outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Tenet Healthcare Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
19.32%
Industry Style: Defensive, Growth, Innovation
High GrowthEPS CAGR
1688.12%
Industry Style: Defensive, Growth, Innovation
High GrowthFCF CAGR
77.14%
Industry Style: Defensive, Growth, Innovation
High Growth