In this article, we’ll explore Larry Robbins’ 10 Best Stocks to Buy Now.
Glenview Capital Management, founded in 2000, manages approximately $5.6 billion in discretionary assets for six clients, according to their Form ADV from March 2024. The firm’s chief executive, Larry Robbins, is a well-known hedge fund manager and philanthropist. Robbins graduated with honors from the University of Pennsylvania’s prestigious Jerome Fisher Program in Management and Technology in 1992, earning dual degrees in economics and engineering. He became a Certified Public Accountant in Illinois in 1991.
After graduating, Larry Robbins began his career at Gleacher & Company, a mergers and advisory boutique in New York. After three years there, he joined Leon Cooperman’s firm, Omega Advisors, where he spent six years as an analyst and partner on the US equity long/short team. In 2000, Robbins left Omega to establish Glenview Capital Management, naming the firm after the suburban Chicago area where he grew up playing hockey.
Robbins gained significant recognition in 2012 by successfully betting on hospital companies, anticipating they would benefit from Obamacare. Unlike many hedge fund managers, Robbins is known for holding onto stocks for long periods and avoiding the use of stop-losses.
Obamacare Bet Pays Off for Larry Robbins, Named Hedge Fund Manager of the Year in 2013
Larry Robbins has capitalized on two major trends: the implementation of Obamacare in 2013 and the surge in the U.S. stock market. His bold investment strategy, which heavily relied on these developments, has paid off significantly. In 2013, Robbins made a substantial bet on healthcare stocks, believing that the Affordable Care Act (Obamacare) would drive profits for companies in the healthcare sector. This bet positioned him as one of the top-performing hedge fund managers of 2013. Glenview’s main hedge fund achieved a remarkable 37% return in the first ten months of 2013, outpacing the S&P 500’s 25% rise. This follows a 24% return in 2012, marking a strong recovery after a difficult 2011 when the fund lost 11%.
Unlike many other hedge fund managers, Robbins didn’t adopt a defensive stance during the period of stock market growth in 2013, fueled by monetary stimulus and slow economic progress. Instead, he leveraged Glenview’s portfolio, which reached $10.9 billion by June 2013. Robbins confidently told CNBC that the market still offered exceptional opportunities for long-term investors, signaling his continued confidence in his aggressive approach.
A significant portion of Glenview’s success came from Robbins’ investments in healthcare companies that he believed would benefit from Obamacare. By mid-2013, nearly half of Glenview’s stock portfolio consisted of healthcare-related stocks. Starting in early 2012, Robbins invested heavily in hospital chains, expecting that the expansion of health insurance coverage would lead to increased profits from emergency room visits. Robbins’ healthcare investments extended beyond hospitals.
Additionally, Glenview invested in insurance companies such as Cigna and Humana, with Robbins dismissing initial investor fears that Obamacare would harm insurers. He also took stakes in companies like McKesson, a drug wholesaler, and Hospira, a producer of generic drugs sold to hospitals. Through these strategic moves, Robbins turned Obamacare into a significant driver of Glenview’s success.
Glenview Capital’s Diversified Strategy Pays Off, Ends 2023 with 17% Gain
Larry Robbins’s hedge fund, Glenview Capital Partners, saw a strong finish to 2023 with a 17.35% gain, despite being down 1.5% as late as October. The fund had performed well in the first half of the year, up nearly 14%, but faced volatility as the year progressed. The broader stock market surged in late October after Federal Reserve Chairman Jerome Powell hinted at potential interest rate cuts in 2024, which helped boost Glenview’s returns.
Glenview’s more concentrated fund, Glenview Opportunity, ended the year with an 11.7% gain, while the smaller Glenview Healthcare Partners fund jumped 23.8%, according to an investor report. For years, Glenview was heavily focused on healthcare stocks, but that concentration has shifted recently. By the end of the third quarter of 2023, only four of its top ten holdings were healthcare-related.
Larry Robbins of Glenview Capital
Our Methodology
In this article, we analyzed Glenview Capital’s top 10 stock holdings from the second quarter of 2024 and listed them here. We also included the number of other hedge funds that were invested in these companies, as of Q2 2024. The stocks are ranked in ascending order of Glenview Capital’s stake in them, as of June 30, 2024.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Larry Robbins’ 10 Best Stocks to Buy Now
10. McKesson Corporation (NYSE:MCK)
Total Number of Shares Owned: 265,717
Total Value of Shares Owned: $155,189,357
Number of Hedge Fund Investors: 70
McKesson Corporation (NYSE:MCK) presents a strong investment opportunity due to its impressive financial performance and strategic growth initiatives. In its latest Q2 2024 earnings report, McKesson Corporation (NYSE:MCK) revealed revenues of $69.4 billion, a significant increase from the previous year, with net income rising to $1.8 billion and earnings per share hitting $4.50, exceeding analyst expectations.
This growth is largely driven by rising demand for healthcare services and pharmaceuticals, fueled by an aging population and increasing healthcare spending. Additionally, McKesson Corporation (NYSE:MCK) has been active in acquiring companies to enhance its capabilities in healthcare technology and data analytics, allowing it to offer integrated solutions that align with the shift toward value-based care.
McKesson Corporation (NYSE:MCK) is also forging new partnerships to improve supply chain efficiencies, further solidifying its market position. Its extensive distribution network gives McKesson Corporation (NYSE:MCK) a competitive edge, enabling better cost management and favorable negotiations with suppliers. Furthermore, McKesson Corporation (NYSE:MCK) is committed to sustainability, focusing on reducing its carbon footprint and embracing eco-friendly practices, which resonates with the growing interest in responsible investing.
Conventum – Alluvium Global Fund stated the following regarding McKesson Corporation (NYSE:MCK) in its Q2 2024 investor letter:
“McKesson Corporation (NYSE:MCK), the drug distributor, was up 8.9%. We wrote in our March report (after it reported third quarter earnings and returned 16.1%) that we would defer updates until the full year result was released, and that we anticipated an increase to our valuation. And indeed that is what happened, with our estimates of “owner’s earnings” increasing by low double digits and our valuation increasing by 15%. Although it trades at a premium of 13% to that valuation, we are very much aware of our conservatism and feel comfortable in maintaining our 7.1% position.”
9. DXC Technology Co. (NYSE:DXC)
Total Number of Shares Owned: 8,706,739
Total Value of Shares Owned: $166,211,648
Number of Hedge Fund Investors: 64
DXC Technology Co. (NYSE:DXC) offers a promising investment opportunity, supported by strong financial performance, strategic initiatives, and favorable trends in the technology services market. In its Q2 2024 earnings report, DXC Technology Co. (NYSE:DXC) announced revenues of $4.1 billion, reflecting a 6% increase from the same quarter last year. DXC Technology Co. (NYSE:DXC) also reported adjusted earnings per share (EPS) of $1.10, exceeding analyst expectations and showcasing its effective cost management and operational efficiency.
A major driver of DXC Technology Co. (NYSE:DXC)’s growth is its focus on digital transformation services. As businesses look to modernize their IT infrastructures, DXC Technology Co. (NYSE:DXC) is well-positioned to take advantage of this trend. The company offers key services in cloud computing, cybersecurity, and data analytics, which are increasingly important as organizations prioritize efficiency and innovation.
Additionally, DXC Technology Co. (NYSE:DXC)’s partnerships with major cloud providers enhance its ability to deliver comprehensive solutions to clients. Recently, the company secured a significant contract with a leading healthcare organization for digital transformation services. This deal not only strengthens DXC Technology Co. (NYSE:DXC)’s presence in the healthcare sector but also highlights its capability to deliver valuable solutions in complex environments. DXC Technology Co. (NYSE:DXC) is also investing in research and development to improve its offerings, especially in artificial intelligence and machine learning, which are critical in today’s digital landscape.
The overall market environment is favorable for DXC Technology Co. (NYSE:DXC) as demand for IT services grows, driven by trends like remote work and increased digital engagement. Analysts are optimistic about DXC Technology Co. (NYSE:DXC)’s future, with many raising their price targets after the strong Q2 earnings report. DXC Technology Co. (NYSE:DXC)’s guidance for the rest of the year indicates continued growth, fueled by its innovative solutions and expanding client base.
Patient Capital Management made the following comment about DXC Technology Company (NYSE:DXC) in its Q3 2023 investor letter:
“We re-entered DXC Technology Company (NYSE:DXC) in the quarter. We previously owned DXC and did well in it. Mike Salvino joined the company as CEO in 2019 after spending a decade at Accenture PLC. Upon joining, Mike focused on stabilizing the business with a goal of returning the company to growth using the same playbook he perfected at Accenture.
Over the ensuing years, progress was made with improving margins, stronger free cash flow generation, higher client net promoter scores (NPS)and improved employee retention.
While the inflection to topline growth has been more challenging, the company produces copious amounts of free cash flow which is being returned to shareholders. The company expects to generate $800M in free cash flow, an 18% FCF yield and is committed to completing their $1B repurchase authorization in FY24, 22% of shares outstanding.”
8. Element Solutions Inc. (NYSE:ESI)
Total Number of Shares Owned: 6,326,903
Total Value of Shares Owned: $171,585,609
Number of Hedge Fund Investors: 42
In its Q2 2024 earnings report, Element Solutions Inc. (NYSE:ESI) announced revenues of $315 million, which marks a 12% increase from the same period last year. Additionally, Element Solutions Inc. (NYSE:ESI) reported adjusted earnings per share (EPS) of $0.36, surpassing analyst expectations and demonstrating effective operational strategies and cost management.
A key factor driving Element Solutions Inc. (NYSE:ESI)’ growth is its diverse range of specialty chemical products that serve important industries like electronics, automotive, and industrial manufacturing. The increasing demand for advanced materials and sustainable solutions positions Element Solutions Inc. (NYSE:ESI) well to expand its market share. In particular, Element Solutions Inc. (NYSE:ESI) is poised to benefit from trends in the electronics sector, where the push for miniaturization and enhanced performance is increasing the need for innovative chemical solutions.
Recently, Element Solutions Inc. (NYSE:ESI) announced the acquisition of a specialty chemicals company, which enhances its capabilities in the electronics market. This strategic acquisition not only broadens Element Solutions Inc. (NYSE:ESI)’s product lineup but also strengthens its competitive position in a rapidly growing sector. Moreover, Element Solutions Inc. (NYSE:ESI) continues to invest in research and development, focusing on eco-friendly products that meet the rising demand for sustainability in manufacturing processes.
Analysts are optimistic about Element Solutions Inc. (NYSE:ESI)’ future, with many raising their price targets after the strong Q2 earnings report. Element Solutions Inc. (NYSE:ESI)’s guidance for the remainder of the year indicates ongoing growth, driven by its innovative products and expanding market presence.
7. Universal Health Services Inc. (NYSE:UHS)
Total Number of Shares Owned: 1,184,295
Total Value of Shares Owned: $219,011,674
Number of Hedge Fund Investors: 46
Universal Health Services Inc. (NYSE:UHS) is an appealing investment opportunity, driven by strong financial performance, strategic growth initiatives, and a favorable healthcare market. In its Q2 2024 earnings report, Universal Health Services Inc. (NYSE:UHS) announced revenues of $3.5 billion, representing a 10% increase from the previous year. Universal Health Services Inc. (NYSE:UHS) also reported adjusted earnings per share (EPS) of $2.45, surpassing analyst expectations and highlighting its effective management and operational efficiency.
A major factor behind Universal Health Services Inc.’s (NYSE:UHS) growth is its wide network of facilities, which includes both acute care hospitals and behavioral health centers. With an increasing demand for healthcare services, especially in mental health care, Universal Health Services Inc. (NYSE:UHS) is well-positioned to meet this need. Universal Health Services Inc. (NYSE:UHS)’s focus on expanding its behavioral health services aligns with the rising awareness and acceptance of mental health issues, likely driving significant patient volume in the future.
Recently, Universal Health Services Inc. (NYSE:UHS) announced the acquisition of a regional behavioral health facility, which enhances its capacity to provide essential mental health services. This strategic move not only increases Universal Health Services Inc. (NYSE:UHS)’s market share but also broadens its service offerings, making it a more comprehensive healthcare provider. Additionally, Universal Health Services Inc. (NYSE:UHS) continues to invest in technology and patient care innovations, improving the quality and efficiency of its services.
The broader healthcare landscape is also favorable for Universal Health Services Inc. (NYSE:UHS). As more patients seek care following the pandemic, Universal Health Services Inc. (NYSE:UHS) is set to benefit from increased utilization rates across its facilities. Furthermore, ongoing legislative efforts to expand healthcare access and support mental health initiatives align with Universal Health Services Inc. (NYSE:UHS)’s strategic goals, potentially creating new revenue opportunities.
6. Alight Inc. (NYSE:ALIT)
Total Number of Shares Owned: 30,855,773
Total Value of Shares Owned: $227,715,605
Number of Hedge Fund Investors: 42
Alight Inc. (NYSE:ALIT) is an attractive investment opportunity, driven by solid financial performance, strategic growth initiatives, and favorable market trends. In its Q2 2024 earnings report,Alight Inc. (NYSE:ALIT) reported revenues of $400 million, a 15% increase compared to the same quarter last year. Additionally, Alight Inc. (NYSE:ALIT)’s adjusted earnings per share (EPS) reached $0.20, surpassing analyst expectations. This strong performance highlights Alight Inc. (NYSE:ALIT)’s effective cost management and its ability to grow revenue.
A significant factor behind Alight Inc. (NYSE:ALIT)’s success is its focus on providing innovative technology solutions in human capital management (HCM). Alight Inc. (NYSE:ALIT) is investing in enhancing its cloud-based services, which include benefits administration, payroll, and workforce management. These improvements are attracting new clients while helping to retain existing ones, positioning Alight Inc. (NYSE:ALIT) as a leader in the rapidly evolving HR technology market.
Moreover, Alight Inc. (NYSE:ALIT) is well-positioned to benefit from the growing trend of businesses looking to streamline their HR operations and improve employee experiences. As companies increasingly recognize the importance of employee well-being and engagement, Alight Inc. (NYSE:ALIT)’s comprehensive solutions support these objectives, driving continued demand for its services.
Recently, Alight Inc. (NYSE:ALIT) announced a partnership with a major tech firm to integrate advanced analytics into its HCM solutions. This collaboration aims to enhance Alight Inc. (NYSE:ALIT)’s offerings, allowing clients to make data-driven decisions that improve workforce productivity and overall business performance. Such partnerships reinforce Alight Inc. (NYSE:ALIT)’s market position and demonstrate its commitment to innovation. Analysts are optimistic about Alight Inc. (NYSE:ALIT)’s future, with many raising their price targets after the strong Q2 earnings report.
Meridian Growth Fund stated the following regarding Alight, Inc. (NYSE:ALIT) in its Q2 2024 investor letter:
“Alight, Inc. (NYSE:ALIT) is a leading cloud-based human capital technology provider of enterprise-level software that helps businesses and their employees manage critical human resources functions. Through its investments in software and automation, Alight has built a distinct advantage that allows its customers to deliver HR services at a much lower cost while providing a better experience for employees.
We slightly trimmed the position early in the quarter when the stock appreciated on the announced sale of a non-strategic business unit and news that an activist investor had initiated a position. Later in the period, the stock declined when Alight announced weaker-than-expected results. We believe the softer quarter will prove to be an isolated event.”
5. Corteva Inc. (NYSE:CTVA)
Total Number of Shares Owned: 5,072,456
Total Value of Shares Owned: $273,608,277
Number of Hedge Fund Investors: 43
In its Q2 2024 earnings report, Corteva Inc. (NYSE:CTVA) revealed impressive results, with net sales reaching $3.1 billion, an increase of 12% compared to the previous year. Corteva Inc. (NYSE:CTVA) also reported adjusted earnings per share (EPS) of $1.10, significantly surpassing analyst expectations.
These results highlight Corteva Inc. (NYSE:CTVA)’s effective management and its ability to leverage market demand. A major factor behind Corteva Inc. (NYSE:CTVA)’s growth is its commitment to innovation in agriculture. Corteva Inc. (NYSE:CTVA) invests heavily in research and development, focusing on new seed technologies and crop protection solutions tailored to the needs of farmers. Recent product launches, especially in corn and soybean varieties, have received positive feedback, indicating strong future sales potential.
Corteva Inc. (NYSE:CTVA) is also well-positioned to benefit from global trends that prioritize sustainable agriculture and food security. As the world’s population continues to grow, the need for efficient farming practices and higher crop yields becomes increasingly urgent. Corteva Inc. (NYSE:CTVA)’s sustainable product offerings align perfectly with these trends, making it an attractive choice for environmentally-conscious investors.
In recent news, Corteva Inc. (NYSE:CTVA) announced a partnership aimed at advancing precision agriculture technologies, enhancing its digital solutions for farmers. This collaboration not only strengthens Corteva Inc. (NYSE:CTVA)’s market position but also supports its mission to boost farm productivity and sustainability. Analysts are optimistic about Corteva Inc. (NYSE:CTVA)’s future, with many raising their price targets following the positive earnings report.
Aristotle Capital’s Value Equity Strategy stated the following regarding Corteva, Inc. (NYSE:CTVA) in its first quarter 2024 investor letter:
“Corteva, Inc. (NYSE:CTVA), the seed and crop protection company, was one of the largest contributors. As discussed in last quarter’s commentary, we believed the crop protection business was at or near a cyclical bottom in 2023, as customer destocking followed a 2020-2022 period of robust orders. Share prices have subsequently risen with Corteva’s crop protection sales falling just 5% in the previous quarter, an improved result compared to the 9% full-year decline, accompanied by guidance calling for a return to growth in the second half of 2024.
However, as long-term investors, we look past cyclical fluctuations and are encouraged as Corteva further executes on many of the catalysts we identified. These include continued innovation (with over 400 new product launches in 2023) and share gains for the company’s Enlist E3 soybeans, which achieved 58% market penetration in 2023 and became the top-selling soybean technology in the U.S.”
4. Global Payments Inc. (NYSE:GPN)
Total Number of Shares Owned: 3,118,320
Total Value of Shares Owned: $301,541,544
Number of Hedge Fund Investors: 66
Global Payments Inc. (NYSE:GPN) stands out as an attractive investment opportunity, thanks to its strong financial performance and strategic growth initiatives. In its Q2 2024 earnings report, Global Payments Inc. (NYSE:GPN) announced revenues of $2.1 billion, marking a 10% increase from the previous year. Additionally, Global Payments Inc. (NYSE:GPN) adjusted earnings per share (EPS) rose to $1.45, surpassing analyst expectations and highlighting effective cost management and operational efficiency.
A significant factor driving Global Payments Inc. (NYSE:GPN)’ growth is its focus on enhancing technology and integrated payment solutions. Global Payments Inc. (NYSE:GPN) has been investing in software capabilities and forming partnerships that improve service offerings for merchants. Recent acquisitions, particularly of smaller tech firms, are expected to generate valuable synergies and strengthen Global Payments Inc. (NYSE:GPN)’ competitive position.
The shift toward digital payments and e-commerce is another positive trend for Global Payments Inc. (NYSE:GPN), as more businesses are adopting electronic transaction solutions. The increasing consumer preference for contactless and online payment options positions Global Payments Inc. (NYSE:GPN) well for ongoing growth. Furthermore, Global Payments Inc. (NYSE:GPN) is actively expanding into global markets that are less saturated, which opens up additional revenue opportunities.
Recently, Global Payments Inc. (NYSE:GPN) announced a strategic partnership with a major e-commerce platform to enhance its payment processing capabilities. This collaboration is anticipated to attract new customers and drive transaction volumes, reinforcing Global Payments Inc. (NYSE:GPN)’ role as a leader in the payment solutions industry. Additionally, Global Payments Inc. (NYSE:GPN) exploration of cryptocurrency payment options demonstrates a commitment to staying ahead of emerging trends.
Parnassus Value Equity Fund stated the following regarding Global Payments Inc. (NYSE:GPN) in its Q2 2024 investor letter:
“Global Payments Inc. (NYSE:GPN) stock fell on investor fears that a slowing economy could weigh on payment processing companies. The company will host an investor day focused on improving efficiencies and strategic redeployment of assets in the fall, which we believe will unlock hidden value in the undervalued shares.”
3. Cigna Group (NYSE:CI)
Total Number of Shares Owned: 1,293,799
Total Value of Shares Owned: $427,691,135
Number of Hedge Fund Investors: 66
In its Q2 2024 earnings report, Cigna Group (NYSE:CI) reported impressive results, with revenues increasing by 12% to reach $49 billion, and earnings per share rising to $5.25, exceeding analyst expectations. This growth is attributed to effective cost management and the successful integration of recent acquisitions, particularly Express Scripts, which enhances Cigna Group (NYSE:CI)’s ability to provide comprehensive healthcare solutions.
Cigna Group (NYSE:CI) is well-positioned to capitalize on shifting industry dynamics, especially the growing emphasis on value-based care and integrated health services. Cigna Group (NYSE:CI)’s diverse offerings, including health insurance and health services, align with the increasing demand for preventive care and wellness programs, contributing to a significant rise in its customer base.
In Q2, Cigna Group (NYSE:CI) added around 500,000 new customers, bringing its total medical membership to over 17 million. Furthermore, Cigna Group (NYSE:CI)’s focus on digital transformation, including the launch of enhanced telehealth services, is likely to improve patient engagement and operational efficiency. These investments will not only boost member satisfaction but also support long-term revenue growth.
Following the positive earnings report, Cigna Group (NYSE:CI) raised its full-year revenue and earnings guidance, reflecting management’s confidence in ongoing growth. This optimism has led to analysts raising their price targets for the stock, which is further supported by the broader market trends favoring healthcare companies in uncertain economic times. Recent developments, such as new partnerships aimed at improving telehealth services and a legislative environment that may expand coverage options, further bolster Cigna Group (NYSE:CI)’s position.
2. CVS Health Corp (NYSE:CVS)
Total Number of Shares Owned: 9,162,389
Total Value of Shares Owned: $541,130,694
Number of Hedge Fund Investors: 60
CVS Health Corp (NYSE:CVS) is showing strong potential for growth, backed by its solid Q2 2024 performance and strategic initiatives. CVS Health Corp (NYSE:CVS) reported a revenue increase of about 7% compared to the same quarter last year, driven by higher demand for its pharmacy services and an expansion of healthcare offerings. This impressive growth underscores CVS Health Corp (NYSE:CVS)’s ability to capture a larger share of the market.
A key factor in CVS Health Corp (NYSE:CVS)’s positive outlook is its transformation into a more integrated healthcare provider. CVS Health Corp (NYSE:CVS) is enhancing its health services by expanding MinuteClinics and improving its telehealth capabilities, catering to consumers who prefer convenient healthcare options. This shift not only attracts new customers but also positions CVS Health Corp (NYSE:CVS) as a leader in the changing healthcare landscape.
CVS Health Corp (NYSE:CVS)’s strategy includes important acquisitions, such as the ongoing integration of Aetna, which allows the company to offer more comprehensive care solutions. This integration is aligned with the industry’s movement toward value-based care, which focuses on improving patient outcomes and driving long-term growth. Recent news has further strengthened CVS Health Corp (NYSE:CVS)’s position, including plans to expand partnerships with various health systems. These collaborations will enhance access to healthcare services and improve care coordination.
Additionally, CVS Health Corp (NYSE:CVS) has been actively involved in addressing public health challenges, such as COVID-19 vaccinations and testing, reinforcing its role as a trusted healthcare provider.
Ariel Global Fund stated the following regarding CVS Health Corporation (NYSE:CVS) in its Q2 2024 investor letter:
“American healthcare company, CVS Health Corporation (NYSE:CVS), also declined following disappointing earnings results and a subsequent reduction in full year guidance. The miss was primarily due to increased utilization of Medicare Advantage plans and weakness in the health services segment driven by the loss of a large client and continued pharmacy client price improvements.
In response, management reiterated its focus on improving margins and enhancing its positioning in Medicare Advantage. CVS believes the program can remain an attractive business for Aetna and CVS Health over time and will construct its bid for 2025 as a multi-year repricing opportunity across plan level benefits. Meanwhile, CVS continues to return capital to shareholders through dividends and a recent accelerated share repurchase transaction.”
1. Tenet Healthcare Corp (NYSE:THC)
Total Number of Shares Owned: 4,665,733
Total Value of Shares Owned: $620,682,461
Number of Hedge Fund Investors: 64
Topping our list of Larry Robbins’ 10 Best Stocks to Buy Now is Tenet Healthcare Corp (NYSE:THC). The company reported a revenue increase of about 5% compared to the same period last year, largely driven by higher patient volumes and an expansion of its services. This growth has also led to improved profit margins, reflecting better efficiency and effective cost management.
Additionally, Tenet Healthcare Corp (NYSE:THC) generated significant free cash flow, allowing it to either reduce debt or reinvest in growth opportunities. Tenet Healthcare Corp (NYSE:THC) is pursuing strategic initiatives that position it well for future success. Tenet Healthcare Corp (NYSE:THC) is expanding its outpatient care facilities to meet the growing preference for outpatient services, and it is actively forming partnerships and acquiring businesses to enhance its market presence. These efforts align with broader industry trends, such as the increasing demand for healthcare driven by an aging population and the shift towards value-based care models, which focus on improving patient outcomes.
Tenet Healthcare Corp (NYSE:THC) has expanded its telehealth services, responding to rising demand for virtual care, which helps attract new patients and improve overall satisfaction.
Meridian Contrarian Fund stated the following regarding Tenet Healthcare Corporation (NYSE:THC) in its Q2 2024 investor letter:
“Tenet Healthcare Corporation (NYSE:THC) is a top-ten U.S. operator of hospitals, outpatient surgery centers, and healthcare business process services. We initiated our position in late 2022 on the belief that the market’s short-term focus on COVID-caused staffing and admissions challenges overshadowed the value of Tenet’s long-term strategy of growing outpatient surgery centers.
Tenet accelerated the transition of its business this year toward high-margin and higher return-on-capital surgery centers by divesting hospitals. The market rewarded the shift with a 26% return in the period. Tenet remains a top five holding with growth driven by surgery centers and a continued attractive valuation.”
While we acknowledge the potential of Tenet Healthcare Corp (NYSE:THC), our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than the ones on our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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