HCA: $285 Fair Value Means a Buy Opportunity Now
By stockpickr AI | March 2, 2026 | 10 min read
Investment Summary
HCA Healthcare, operating in the Health Care Facilities sector, appears slightly undervalued based on the DCF analysis, driven by stable operational cash flows and disciplined capital allocation.
Investment Recommendation
Buy
Fair Value: $285.50
Current Price: $270.78
Upside/Downside: +5.44%
The DCF analysis yields an intrinsic value suggesting a slight upside from the current market price of $270.78. The valuation is supported by the company's consistent Free Cash Flow generation and relatively low forward P/E multiple compared to historical averages.
Key Metrics
- Market Cap: $43.02B
- P/E Ratio: 12.99x
- Forward P/E: 11.41x
- Revenue Growth (YoY): 5.35%
- Net Margin: 9.21%
- ROE: 37.48%
- Debt/Equity: 2.65
- Dividend Yield: 1.45%
Strengths
- High Return on Equity (ROE) of 37.48% indicates efficient capital utilization.
- Strong revenue growth trajectory, with 2023 revenue reaching $64.67B, up 5.35% YoY.
- Significant scale advantage in key U.S. markets, providing negotiating leverage with payors.
- Stable profitability, with a Net Margin of 9.21% in the last reported year.
Risk Factors
- High leverage indicated by a Debt-to-Equity ratio of 2.65, increasing sensitivity to interest rate changes.
- Significant labor cost inflation impacting operating margins, especially for contract nursing services.
- Regulatory and reimbursement uncertainty within the U.S. healthcare system.