Tenet Healthcare stock price target raised to $230 from $189 at RBC Capital

Investing.com - RBC Capital raised its price target on Tenet Healthcare (NYSE:THC) to $230 from $189 while maintaining an Outperform rating, citing strong growth potential and an enhanced capital structure. The healthcare provider, currently valued at $17 billion, has earned a "GREAT" financial health score according to InvestingPro analysis.

The firm reiterated Tenet Healthcare as its top pick in the hospital sector, noting the company trades at a valuation discount compared to HCA Healthcare. Trading at a P/E ratio of 11.8x, the stock has shown impressive momentum with a 54% gain over the past six months.

RBC Capital’s price target increase reflects what the firm believes is a growing likelihood of an Affordable Care Act (ACA) enhanced subsidy fix, along with potential benefits from expanded state supplemental programs in key states.

The firm noted that hospital operators at a recent industry event confirmed increasing interest among some Republican lawmakers in an ACA enhanced subsidy fix, consistent with commentary from RBC’s mid-August Nashville Bus Tour.

Since the signing of the OBBBA (Opportunity, Benefits, and Bargaining for Better America Act), Tenet Healthcare shares have risen approximately 14.5%, while HCA Healthcare stock has gained about 10.7%, according to RBC Capital.

In other recent news, Tenet Healthcare has seen several changes in its stock price targets following its latest financial results. The company reported second-quarter 2025 results that exceeded expectations, with an adjusted EBITDA excluding non-controlling interests of $887 million, surpassing Raymond James’ estimate of $758 million. This performance led Raymond James to raise its price target for Tenet Healthcare to $200 from $185, maintaining an Outperform rating. BofA Securities also increased its price target to $205 from $195, citing the company’s quarterly results that exceeded expectations and prompted an upward revision in guidance.

Additionally, UBS raised its price target to $238 from $230, maintaining a Buy rating, and highlighted a favorable $79 million impact from supplemental payments related to the Tennessee Directed Payment Program. Cantor Fitzgerald, despite noting some concerns about future signals of strength, increased its price target to $190 from $177, maintaining an Overweight rating. Cantor Fitzgerald’s analysis also considered potential risks related to Affordable Care Act marketplace challenges, which represent about 5% of Tenet Healthcare’s revenue. These developments reflect a positive response from analysts to Tenet Healthcare’s recent performance and future outlook.

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