Tenet CEO ‘Not Seeing Signs’ Of Patient Demand Flagging
The leaders of Tenet Healthcare Corp. expect that the strong demand from patients for healthcare services will persist well into next year.
Dallas-based Tenet put up strong growth in the third quarter in both of its operating divisions. Same-store admissions at the company’s hospitals rose 5.2 percent from the third quarter of 2023 while its USPI surgery center group grew its case count 1.0 percent and its revenues nearly 9 percent at facilities it has owned for more than a year. That growth combined with labor cost controls helped the company more than double its net income for the quarter to $681 million and allowed Chairman and CEO Saum Sutaria and his team raise their 2024 earnings guidance.
Speaking to analysts on a conference call, Sutaria said Tenet executives see nothing in the market today to make them think the robust demand for the company’s services will fall off in the coming months.
“We’re not planning differently for the first quarter next year versus the last quarter of this year,” he said. “We’re not seeing signs or signals that we should stop looking to add capacity selectively in markets where that demand could be serviced in an appropriate cost structure.”
Some recent examples of such capacity investments include the opening of six surgery centers last quarter and nearly 20 others that are in the works. On the hospital side, Tenet in July opened a facility near San Antonio and is on track to complete a hospital in Port St. Lucie, Florida, next year. On the flip side, the company on Sept. 30 completed the sale of its 70 percent stake in Alabama’s Brookwood Baptist Health system to Orlando Health.
Shares of Tenet (Ticker: THC) jumped nearly 17 percent on the company’s earnings report and conference call commentary. They have now more than doubled this year, growing Tenet’s market capitalization to about $15.6 billion.
