Hospital operator Community Health Systems, Inc. CYH is set to report fourth-quarter 2024 results on Feb. 18, 2025, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at 5 cents per share and the same for revenues is pinned at $3.16 billion. 

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The fourth-quarter earnings estimate has increased a penny over the past month. The bottom-line estimate indicates a year-over-year improvement of 112.2%. However, the Zacks Consensus Estimate for quarterly revenues implies a year-over-year decline of 0.7%.

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For 2024, the Zacks Consensus Estimate for Community Health’s revenues is pegged at $12.53 billion, implying a rise of 0.3% year over year. Meanwhile, the consensus mark for current year EPS is pegged at a loss of 55 cents, implying an improvement of around 60.4% on a year-over-year basis.

Community Health beat the consensus estimate in one of the last four quarters and missed thrice, with the average negative surprise being 395.6%.

Q4 Earnings Whispers for Community Health

Our proven model predicts a likely earnings beat for the company this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is precisely the case here.

CYH has an Earnings ESP of +29.63% and a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

What is Shaping Community Health’s Q4 Results?

Declining cost growth, rising occupancy rate and revenue per adjusted admission are expected to have offset the negative effects of lower beds in service, adjusted admissions and patient days, positioning the company for an earnings beat in the fourth quarter.

Our model estimate for fourth-quarter salaries and benefits, supply costs, lease costs and rent indicate declines from the year-ago level, keeping overall expense growth pretty low. This is expected to have aided the margins. The Zacks Consensus Estimate for fourth-quarter occupancy rate is pegged at 53.57%, up from the year-ago level of 53.5%. Our model estimate for the metric is pegged at 53.6%.

We expect revenue per adjusted admission to have increased more than 6% in the fourth quarter, leading to full-year growth of more than 4%. However, both the Zacks Consensus Estimate and our model estimate for fourth-quarter beds in service indicate more than 11% year-over-year decline.

Similarly, both the Zacks Consensus Estimate and our model estimate for fourth-quarter adjusted admissions indicate a nearly 8% year-over-year decrease. Further, both estimates predict an around 11% fall in patient days in the quarter under review. This is likely to have resulted in a year-over-year decline in the top line.

How Did Other Stocks Perform?

Here are some stocks in the broader Medical space that have already reported earnings for this quarter: HCA Healthcare, Inc. HCA, The Ensign Group, Inc. ENSG and The Cigna Group CI.

HCA Healthcare reported fourth-quarter 2024 adjusted EPS of $6.22, which outpaced the Zacks Consensus Estimate by 4.2%, driven by higher patient volumes giving rise to an increased number of inpatient surgeries and same-facility emergency room visits. However, the upside was partly offset by elevated salaries and benefits expenses. Additional expenses due to Hurricane Helene and Hurricane Milton also impacted the results.

Ensign reported fourth-quarter 2024 adjusted earnings per share of $1.49, which outpaced the Zacks Consensus Estimate by 1.4%, thanks to improved occupancy rates, higher patient days and higher skilled service revenues. The positives were partly offset by an elevated expense level, due to the higher cost of services and rents. 

Cigna reported fourth-quarter 2024 adjusted earnings per share of $6.64, which missed the Zacks Consensus Estimate by 15.2%, due to a decline in its overall medical customer base and elevated medical costs. Nevertheless, the downside was partly offset by expanding specialty volumes in the Evernorth Health Services segment and new client wins.

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Cigna Group (CI) : Free Stock Analysis Report

Community Health Systems, Inc. (CYH) : Free Stock Analysis Report

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