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THE GIST
NEWS AND FEATURES
Global Philippines Fine Living
INSIGHTS
INVESTMENT STRATEGY
Economy Stocks Bonds Currencies
THE BASICS
Investment Tips Explainers Retirement
WEBINARS
2024 Mid-Year Economi Briefing, economic growth in the Philippines
2024 Mid-Year Economic Briefing: Navigating the Easing Cycle
June 21, 2024
Investing with Love
Investing with Love: A Mother’s Guide to Putting Money to Work
May 15, 2024
retirement-ss-3
Investor Series: An Introduction to Estate Planning
September 1, 2023
View All Webinars
DOWNLOADS
economy-ss-8
Inflation Update: Weak demand softens shocks
July 4, 2025 DOWNLOAD
948 x 535 px AdobeStock_433552847
Economic Updates
Monthly Economic Update: Fed cuts incoming   
June 30, 2025 DOWNLOAD
equities-3may23-2
Consensus Pricing
Consensus Pricing – June 2025
June 25, 2025 DOWNLOAD
View all Reports
Bonds Market Movements Top Picks Issuer List
  • Top Picks
  • HCA Healthcare
Corporate Bonds

HCA Healthcare

  • Bond: HCA 5.25 30
  • Indicative Yield-to-Maturity (YTM): 5.013%
  • Credit Rating : BBB
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Fundamental View

AS OF 28 May 2025
  • HCA’s volume metrics and EBITDA margins consistently best industry peers, primarily due to strong operational efficiency and an inpatient/outpatient focus within large, healthy markets.

  • HCA’s credit metrics have improved in recent years and leverage sits near the low end of management’s target net leverage range of 2.75-3.75x.

  • HCA benefits from substantial financial flexibility provided by strong FCF generation and easy access to the capital markets. The company also maintains sufficient liquidity with a well-laddered maturity schedule.

Business Description

AS OF 28 May 2025
  • HCA operates more than 190 hospitals with ~50k beds and 125 freestanding surgery units (as of 1Q25). The company operates in 20 states and England, but ~50% of its hospitals are located in Texas and Florida. HCA is the largest for-profit hospital operator in the US by revenue. HCA also purchased 41 urgent care centers in Texas from FastMed for an undisclosed amount.
  • HCA has gone private twice since its initial public offering in 1969, most recently in 2006. During periods of private ownership the company has engaged in debt-financed special dividends. HCA returned to public ownership in 2011.
  • HCA has been an active consolidator in the industry, acquiring General Health Services, Columbia Healthcare, Hospital Affiliates, and Healthcare Corp, among others. In rationalizing its offering of services and market focus, HCA has sold or spun-off hospital groups such as LifePoint, Triad, and HealthTrust.

Risk & Catalysts

AS OF 28 May 2025
  • We see some risk of choppy operating performance tied to an unwind of acuity and payor mix benefits experienced through COVID.

  • HCA guides to FY25 revenue growth of ~5% and adjusted EBITDA growth of ~6%. Management reported an 9% YoY decline in 1Q25 contract labor costs and with expectations of this trend to continue through FY25.

  • HCA maintains the flexibility to manage to target leverage levels. Net leverage totaled 3.1x at 1Q25. Management updated its net leverage target to 2.75-3.75x (from 3-4x previously).

  • HCA’s board recently authorized an additional $10 bn share repurchase program (with a significant portion expected to be completed in FY25).

Key Metric

AS OF 28 May 2025
$ mn Y20 Y21 Y22 Y23 Y24 LTM 1Q25
Revenue 51,533 58,752 60,233 64,968 70,603 71,585
SWB 23,874 26,779 27,685 29,487 31,170 31,460
Supplies 8,369 9,481 9,371 9,902 10,755 10,848
Adj. EBITDA 10,037 12,644 12,067 12,726 13,882 14,262
Total Debt 31,004 34,579 38,084 39,593 43,031 44,576
Gross Leverage 3.1x 2.7x 3.2x 3.1x 3.1x 3.1x
Interest Coverage 6.2x 8.4x 7.3x 6.7x 7.2x 7.4x
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CreditSight View Comment

AS OF 04 Jul 2025

We maintain an Outperform recommendation on HCA. HCA remains the strongest hospital operator in the for-profit space, exhibiting operational stability and strong FCF generation. These strengths should help the company weather any tariff- or policy-related headwinds. We see HCA as a good alternative to some of the widest BBB-rated credits in our IG Pharma universe, namely Biogen and Viatris.

Recommendation Reviewed: July 04, 2025

Recommendation Changed: May 02, 2018

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