Leaders at Tenet Healthcare Corp. expect strong patient demand for healthcare services to persist well into next year.
Dallas-based Tenet posted strong growth in the third quarter across its two operating divisions. Same-store admissions at the company’s hospitals increased 5.2 percent from the third quarter of 2023, while its USPI surgical center group increased its caseload by 1.0 percent and revenue by nearly 9 percent in the facilities it has owned for more than a year. That growth combined with labor cost controls helped the company more than doubled its net income for the quarter to $681 million and allowed Chairman and CEO Saum Sutaria and his team to increase their 2024 earnings guidance.
Speaking to analysts on a conference call, Sutaria said Tenet executives see nothing in the current market that would make them think the robust demand for the company’s services will decline in the coming months.
“We are not planning any differently for the first quarter of next year compared to the last quarter of this year,” he said. “We are not seeing signs or signals that we should stop looking to selectively add capacity in markets where that demand could be met with an appropriate cost structure.”
Recent examples of such capacity investments include the opening of six surgery centers last quarter and nearly another 20 in the pipeline. As for hospitals, Tenet opened a facility near San Antonio in July and is on track to complete a hospital in Port St. Lucie, Florida, next year. Separately, on September 30, the company completed the sale of its 70 percent stake in Alabama’s Brookwood Baptist Health system to Orlando Health.
Tenet Stock (Ticker: THC) rose nearly 17 percent in the company’s earnings report and conference call comments. This year they have more than doubled, increasing Tenet’s market capitalization to around $15.6 billion.
