Community Health Systems (NYSE:CYH) — This hospital operator owns or leases 131 hospitals in non-urban and selected urban markets in the United States. The hospital group will be a strong beneficiary of the recently approved federal health care plan, and CYH should outshine most other hospitals.
The company reported Q1 2012 earnings of 91 cents, exceeding analysts’ expectations of 85 cents. Volume trends improved and earnings estimates for the year were bumped up to $3.70 versus $2.87 in 2011.
On Thursday, following the Supreme Court’s approval of the health care plan, CYH broke out from one of the most reliable chart formations — the cup-and-handle. But the stock could pull back slightly after the euphoria of the bill’s passage subsides. Our buy under price for CYH is $26.50 with a target of $35.