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HCA Holdings Gives Peek into Q4 Earnings, 2014 Guide Up

HCA Holdings, Inc. (HCA) announced its preliminary financial and operating results for the third quarter of 2014. The company expects to record income before income taxes of approximately $929 million, up 32.5% year over year.

HCA Holdings’ adjusted earnings before interest, taxes, depreciation and amortization (:EBITDA) are projected to be $1.828 billion, up 14% year over year. Depreciation and amortization is expected to be $460 million, up 3.8% year over year. Interest expense is anticipated to decline 6.8% from the prior-year quarter to $427 million.

Net income of HCA Holdings for the third quarter of 2014 is expected to be approximately $1.16 per share, up 46.8% year over year. The third-quarter results will likely include pretax losses on sale of facilities of $12 million or 2 cents per share.

HCA Holdings expects revenues of $9.220 billion in the third quarter of 2014, up 9% from $8.456 billion in the year-ago quarter. The revenue projection is also higher than the Zacks Consensus Estimate of $9.040 billion.

Meanwhile, same facility admissions increased 2.8% year over year in the third quarter of 2014 against a 14.8% decrease in the year-ago quarter. Same facility equivalent admissions rose 4.1% year over year as compared with an 8.9% decrease in the year-ago quarter.
Additionally, same facility revenue per equivalent admission is projected to increase about 3.5% year over year in the third quarter of 2014.

2014 Guidance

HCA Holdings raised its adjusted earnings per share (EPS) guidance for full-year 2014 to $4.40–$4.60 from the previous guidance of $4.00–$4.25. The Zacks Consensus Estimate for 2014 currently stands at $4.22, lower than the guided range.

HCA Holdings’ new revenue guidance stands at $36.5–$37 billion, higher than $36–$36.5 billion guided earlier.

Additionally, the company upped its adjusted EBITDA guidance for full-year 2014 to $7.25–$7.35 billion from the earlier projection of $7–$7.15 billion.

However, the capital expenditure is expected to remain unchanged at $2.2 billion.

HCA Holdings is scheduled to release third-quarter 2014 results between Nov 3 and Nov 5, 2014. Among other players in the healthcare services industry, Tenet Healthcare Corp. (THC), MEDNAX Inc. (MD) and Acadia Healthcare Company, Inc. (ACHC) are all expected to report their third-quarter 2013 results shortly.

HCA currently carries a Zacks Rank #1 (Strong Buy). While Acadia Healthcare and Tenet Healthcare have the same Zacks Rank as HCA Holdings, MEDNAX has a Zacks Rank #2 (Buy).

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