What happened
Shares of Community Health Systems(NYSE: CYH), one of the nation's largest owners of hospitals, fell more than 40% Tuesday morning after the company reported first-quarter earnings. The stock is down more than 16% so far this year.
So what
The healthcare company, which operates 78 acute-care hospitals in 15 states, reported first-quarter revenue of $3.1 billion, flat sequentially and year over year. It also said it had a net loss of $51 million, or $0.40 in earnings per share (EPS) loss, compared to a loss of $1 million or $0.01 in EPS loss in the same period a year ago. A quarter ago, the company had net income of $446 million and EPS of $3.18. The company's net cash plummeted to $5 million in the first quarter, compared to $101 million in the first quarter a year ago.
Now what
The hope for a turnaround dimmed a bit with the earnings report as the company's finances took a step backward. Now that pandemic relief funds from the federal government have stopped, the company's net income has worsened considerably. Still, the reaction to the report seems a bit overdone, considering revenue is essentially unchanged from a year or a quarter ago. It's also important to note that the company's guidance for 2023 was unchanged. The company said then that it expects yearly revenue of between between $12.2 billion and $12.6 billion, an increase of 1.5% over 2022 at the midpoint. Community Health also said it expected a yearly EPS loss between $0.65 and $0.05, compared to a $1.38 in EPS loss last year.
10 stocks we like better than Community Health Systems
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Community Health Systems wasn't one of them! That's right -- they think these 10 stocks are even better buys.
*Stock Advisor returns as of May 1, 2023
Jim Halley has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
