Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - JPMorgan has reduced its price target on Ardent Health Partners Inc (NYSE:ARDT) to $15.00 from $18.00 while maintaining a Neutral rating on the stock. According to InvestingPro data, analyst targets for the stock range from $12 to $23, with the company currently trading at an attractive P/E ratio of 6.3x.
The healthcare company reported second-quarter earnings that exceeded estimates, largely due to the New Mexico Directed Payment Program (DPP) approval, which provided a $65 million EBITDA benefit in the quarter. Excluding this benefit, Ardent’s core revenue growth aligned with management expectations at approximately mid-single-digit percentage year-over-year. InvestingPro analysis shows the company maintains strong financial health with a current ratio of 2.13, indicating solid liquidity. Get access to more detailed financial insights and 6 additional ProTips with an InvestingPro subscription.
Volume growth was modest at 1.6% year-over-year, reflecting stronger inpatient volumes (admissions and surgeries) offset by softer outpatient surgery trends. On the expense side, while full-time labor and supplies costs remained in line with expectations, professional fees increased 5.8% quarter-over-quarter, creating some pressure. Despite these challenges, the company has maintained a healthy gross profit margin of 57.8% over the last twelve months.
JPMorgan views the New Mexico DPP approval for 2025, which is expected to provide a $130 million EBITDA benefit, as favorable. Management’s commentary regarding expected Medicaid program exemptions for New Mexico, Oklahoma, and other states in 2026 and 2027 was also seen as positive.
The firm maintained its 2025 revenue estimate of $6,315 million (5.8% year-over-year growth) but reduced its adjusted EBITDA forecast slightly to $593 million from $597 million due to higher Medicaid supplemental taxes. Similar adjustments were made to 2026 and 2027 EBITDA projections, leading to the lower price target based on a 4.6x multiple applied to the revised 2027 adjusted EBITDA estimate. The stock has shown significant volatility, with a 15.3% gain in the past week despite being down 30.4% year-to-date. For comprehensive analysis and valuation insights, access the detailed Pro Research Report available exclusively on InvestingPro.
In other recent news, Ardent Health Partners LLC reported a strong second quarter for 2025, with earnings per share reaching $0.52. This performance exceeded market expectations and demonstrated a significant year-over-year revenue increase of 11.9%, totaling $1.65 billion. These results highlight the company’s robust financial health and strategic direction, as reflected in the positive investor response. The company’s earnings and revenue figures are crucial indicators for stakeholders assessing its ongoing performance. While stock movement details are not the focus, the financial results have garnered attention from investors. No major mergers or acquisitions were reported in this period. Analyst upgrades or downgrades were not mentioned in the recent developments.
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