Winner: Tenet Healthcare
Return Since Shutdown: +13%
Finally, Tenet Healthcare (THC) has been an even bigger winner since the shutdown — and Obamacare — began.
The main driver for Tenet’s recent double-digit gains is simple: Tenet finalized its $4.3 billion purchase of Vanguard Health Systems on the first day of the nation’s new fiscal year. THC shares climbed more than 6% on that day alone, then continued climbing after Fitch called the deal “strategically sound.”
Not only does the Vanguard purchase double Tenet’s market in Texas — an obvious advantage — but such size is especially important in the face of the new healthcare law. As Fitch put it:
“The strategic rationale for consolidation in the hospital industry is encouraged by reforms favoring larger, integrated systems of care delivery, including the Affordable Care Act.”
On top of that, the new healthcare expansion is also good for Tenet since it’s expected to boost earnings for hospitals, considering fewer patients will be uninsured.