HCA Healthcare issues $3 billion in senior notes

Today, HCA Healthcare (NYSE:HCA), Inc. announced the completion of a public offering of $3 billion in senior notes. The offering consists of three tranches: $750 million of 5.450% senior notes due in 2031, $1.25 billion of 5.450% senior notes due in 2034, and $1 billion of 5.950% senior notes due in 2054. These notes are senior unsecured obligations and are fully and unconditionally guaranteed by HCA Healthcare.

The new 2031 notes are an additional issuance to an existing series, bringing the total for the 2031 notes to $1.75 billion. They will mature on April 1, 2031, with semi-annual interest payments starting on October 1, 2024. The 2034 and 2054 notes will pay interest semi-annually starting March 15, 2025, and mature on September 15 of their respective years.

The indentures governing the notes contain covenants that limit the issuer's ability to create liens, engage in sale-leaseback transactions, and consolidate or merge with other entities. The issuer has the option to redeem the notes at specified prices and must offer to repurchase the notes at 101% of their principal amount plus accrued interest upon certain change of control events.

The notes were issued under a shelf registration statement filed on May 1, 2023, and are listed on the New York Stock Exchange under the ticker symbol HCA. This financial move is based on a press release statement and further details can be found in the exhibits attached to the SEC filing.

In other recent news, HCA Healthcare has made significant strides in its financial performance. The healthcare services provider recently issued $3 billion in senior notes, a strategic move to manage its debt portfolio. Concurrently, HCA Healthcare reported a strong second quarter performance for 2024, outperforming Wall Street's expectations with adjusted earnings per share increasing by 28% to $5.50. This successful quarter led to revised price targets by Oppenheimer, Truist Securities, Mizuho Securities, and RBC Capital Markets.

Moreover, HCA Healthcare's full-year 2024 guidance has been significantly upgraded, projecting a robust volume growth between 4-6%. The company's financial success has led to a revised full-year revenue projection between $69.75 billion and $71.75 billion. Adjusted EBITDA for the year is expected to range between $13.75 billion and $14.25 billion, with share buybacks anticipated to reach approximately $6 billion, contingent on market conditions.

Despite a 2% decrease in outpatient surgeries, primarily impacting Medicaid and uninsured patients, inpatient admissions and emergency room visits saw an increase. This surge reflects strong demand for services like cardiac procedures and inpatient rehab. These recent developments offer a glimpse into HCA Healthcare's current industry standing.

InvestingPro Insights

As HCA Healthcare takes a significant step in capital management with the public offering of $3 billion in senior notes, it's worth noting that the company's financial health and market performance have been robust. According to InvestingPro data, HCA Healthcare boasts a substantial market capitalization of $93.24 billion, reflecting investor confidence. The company's P/E ratio stands at 16.76, suggesting that the stock may be reasonably valued given its earnings. Investors should also take note of the company's revenue growth over the last twelve months, which has been a solid 10.38%.

Moreover, HCA Healthcare's management has demonstrated a commitment to shareholder returns, as evidenced by the fact that it has raised its dividend for three consecutive years. This, combined with a history of share buybacks, indicates a proactive approach to capital allocation. For those looking for stability, HCA's stock generally trades with low price volatility, which might be a comforting factor for risk-averse investors. For a more comprehensive analysis, there are over 15 additional InvestingPro Tips available, which provide deeper insights into HCA's financial health and market position.

These financial metrics and InvestingPro Tips, such as the company's dividend growth and the analysts' upward earnings revisions for the upcoming period, are integral for investors who are considering the impact of the new senior notes offering on HCA Healthcare's financial strategy and future performance.

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