UHS - HCA Tenet send hospital stocks higher after Q2 results

• HCA Healthcare ( NYSE: HCA ) and Tenet Healthcare ( THC ) sparked a rally in the beaten down hospital space on Friday after the two leading healthcare operators in the U.S. exceeded Street forecasts with their 2Q 2022 results.
• However, both companies reported a decline in net income during the quarter as margins contracted amid a rise in costs, particularly in relation to labor expenditure.
• In 2Q 2022, adj. EBITDA margin at HCA ( HCA ) and Tenet ( THC ) fell to ~20.5% and ~16.1% from ~22.3% and ~16.4% in the prior year quarter, respectively.
• Notable gainers in the morning hours include Community Health Systems ( CYH ) which has recorded the best intraday gain since October 2021. Rivals Universal Health Services ( UHS ), Acadia Healthcare ( ACHC ) and Select Medical Holdings ( SEM ) are also on the rise despite a mixed performance of main stock indices today.
• With many hospital operators opting to revise down the outlook early this year, the sector is in a selloff, as shown in this graph.

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