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A Balanced Take on Community Health Systems (CYH) Following JPMorgan Healthcare Conference

Cantor's Joseph France today presses a neutral case on Community Health Systems.


What does the future hold for Community Health Systems (NYSE:CYH)? Cantor analyst Joseph France weighs in on the company, after the latter announced a number of initiatives to improve care quality, increase volumes and reduce expenses in 2018, at the JPMorgan healthcare conference yesterday.

France wrote, “CYH continues to transition to outpatient settings and to grow access points to improve margins and increase volume. We expect CYH’s Transfer Center program to lead to improved admissions capture rates, and we think that its ACO strategy and expanded Bundled Payments program will help to drive improvements. Continuing with its divestitures, CYH expects to have 100 hospitals positioned in markets with better demographics and volume growth, which we believe will be more profitable. CYH also revealed a slightly improved liquidity position, having extended its $600 million receivables facility in November 2017.”

France reiterates a Neutral rating on Community Health shares, with a price target of $6.00, which represents a potential upside of 25% from where the stock is currently trading.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Joseph France has a yearly average return of 7.3% and a 49.5% success rate. France is ranked #838 out of 4739 analysts.

Wall Street backs France’s caution here, as TipRanks analytics reveal CYH as a Hold. Based on 10 analysts polled in the last 3 months, 1 rates a Buy on Community Health stock, 6 maintain a Hold, while 3 issue a Sell on the stock. The 12-month average price target stands at $4.88, marking a 2% upside from where the stock is currently trading.