Benjamin Rossi • JPMorgan Chase & Co.

Answer

President & CFO Matthew DiCanio clarified that the guidance increase reflects strong year-to-date performance with M&A already factored in, anticipating a consistent run-rate for the rest of the year. He confirmed a prior-year weather event in July will be a Q3 comp, but no other major events are expected. Regarding the on-site clinics, DiCanio explained the count was updated to 240 acquired Pivot sites due to different counting methodologies, but the previously stated revenue contribution remains accurate.

Ask Fintool Equity Research AI

Answer

Executive William Newton explained that the employer services volume inflection follows a post-COVID normalization and is driven by sustained sales and marketing efforts. He expressed cautious optimism given the economic climate. Newton outlined a long-term strategy built on three pillars: traditional centers, employer onsites, and telemedicine. He highlighted the Pivot acquisition as a key move that doubles the onsite segment's revenue and creates a strong foundation for future growth, particularly in advanced primary care. Executive Matthew DiCanio added that the strategy aims to provide a comprehensive solution set for employers through multiple access points.

Ask Fintool Equity Research AI

Answer

CEO Christopher Reading confirmed the IIP segment is ahead of budget and remains a key focus for development and capital deployment. Regarding Medicare, he explained that while lawmakers agree a multi-year fix is needed, its high cost is a barrier. He noted that USPH, through industry groups, is advocating for physical therapists to act as primary care gatekeepers for musculoskeletal issues, using data from a successful Maryland pilot to demonstrate system-wide savings that could fund a permanent rate solution.

Ask Fintool Equity Research AI

Answer

CEO Jeff Shaner attributed the guidance increase to strong rate visibility from legislative wins, increased PDS volume, and the inclusion of the Thrive acquisition. CFO Matt Buckhalter clarified that the Q2 results included a $9 million timing-related benefit and a separate $6 million legal settlement reversal that did not impact adjusted EBITDA. He noted the PDS spread rate will normalize as the company completes its wage pass-throughs by year-end.

Ask Fintool Equity Research AI

Answer

CEO Jeff Shaner described the Thrive acquisition as a 'perfect fit' that is culturally aligned, adds density in key states like Texas and Georgia, and is both accretive and deleveraging. Regarding Medicaid, Shaner reported positive, bipartisan dialogue around program integrity, expressing confidence in Aveanna's position as a cost-saving solution for government partners. CFO Matt Buckhalter noted Thrive's impact is not yet in guidance pending the closing date.

Ask Fintool Equity Research AI

Answer

CEO Jeff Shaner explained the Medical Solutions strategy mirrors past efforts in other segments: aligning with preferred payers (17 identified) to improve margins, outcomes, and cash collections, which will temporarily mute volume growth. Regarding Medicaid, Shaner expressed confidence that Aveanna is a "net winner" as its model saves federal and state governments money by shifting care from expensive institutional settings to the home, aligning them with policymakers' goals.

Ask Fintool Equity Research AI

Answer

President & CEO Marty Bonick and CFO Alfred Lumsdaine expressed high confidence that the New Mexico and Oklahoma programs will qualify for grandfathering provisions, as they are approved programs with no changes pushed through concurrent with the OBBA's passage. Lumsdaine stated there is no reason to think they wouldn't fully qualify. Regarding CapEx, Lumsdaine reaffirmed that priorities are unchanged, with spending expected to ramp in the second half of the year, consistent with historical patterns, and trend towards ~4% of revenue to support ambulatory growth.

Ask Fintool Equity Research AI

Answer

CFO Alfred Lumsdaine cited drags from service mix, year-over-year payer denials, and a 70 bps impact from an oncology service transfer as reasons for the modest growth. CEO Martin Bonick explained that regionalizing transfer centers and leveraging their single Epic EHR system allows for better capacity management and patient distribution across their network, increasing patient capture. Alfred Lumsdaine noted guidance depends on professional fees, payer behavior, and tariffs.

Ask Fintool Equity Research AI

Answer

CFO Alfred Lumsdaine explained the guidance range reflects the variables in the top-line revenue and admissions outlook, but highlighted that commercial rate renewals are strong, trending above 4%. He noted that despite high ACA enrollment growth, Ardent's small exposure (3.6% of revenue) means the impact on overall volume growth is not material, and reimbursement is closer to Medicare than commercial rates.

Ask Fintool Equity Research AI

Answer

CEO Marty Bonick explained the transfer was a strategic decision based on unfavorable reimbursement rates for infusion services, as Ardent doesn't qualify for 340B drug pricing. CFO Alfred Lumsdaine emphasized that Ardent retains full operational control in its JVs, allowing for such strategic, market-specific decisions that create a 'win-win' for both partners.

Ask Fintool Equity Research AI

Answer

CEO Eric Evans affirmed the $150 billion TAM remains a valid target, driven by both market share shifts from hospitals and the addition of new procedures. He cautioned against over-emphasizing the initial list of 270+ procedures, viewing it as part of a broader positive trend. Regarding robotics, he described them as critical 'enablers' that allow physicians to bring their higher-acuity, higher-value cases into the ASC setting.

Ask Fintool Equity Research AI

Answer

CFO David Doherty clarified that higher professional fees were in line with expectations and driven by costs associated with physician practices from two large 2024 acquisitions, not widespread anesthesia pressure. CEO J. Evans highlighted that the Q1 recruiting class of 150 physicians is strong and skews toward higher revenue per doctor compared to the 2024 cohort, emphasizing the compounding growth from these new recruits.

Ask Fintool Equity Research AI

Answer

CEO J. Evans stated that the Bain Capital proposal has not impacted their M&A strategy, highlighting the strong pipeline and $53 million already deployed in Q1. On de novos, Evans noted the pipeline is very strong and accretive, with a commitment to 10 per year. CFO David Doherty added that upfront de novo costs are marginal, with facilities typically reaching breakeven within 6-12 months, and expects costs to normalize by 2026.

Ask Fintool Equity Research AI

Answer

Executive VP & CFO Steve Filton clarified that excluding the Tennessee directed payment, behavioral revenue per day increased 4.2%, in line with the sustainable 4-5% pricing growth expectation. Regarding acute care, Filton stated that length of stay has been steadily declining since its pandemic peak and still has some room for further reduction, with the primary challenge being the placement of patients into subacute facilities.

Ask Fintool Equity Research AI

Answer

Executive Steve Filton explained that premium pay has leveled off around $60 million per quarter due to a structural shift in the nursing workforce towards flexible, temporary roles, and he does not anticipate significant further reductions. Regarding tariffs, he noted that multi-year contracts with pricing protection mitigate near-term risk, and no significant impact is factored into 2025 guidance.

Ask Fintool Equity Research AI

Answer

Executive Steve Filton explained that a structural shift in the nursing workforce, with more preferring flexible temporary work, has made further reductions in premium pay challenging. Regarding tariffs, he stated that many multi-year supply contracts provide pricing protection, and no significant impact from tariffs is currently factored into the 2025 guidance.

Ask Fintool Equity Research AI

Answer

Chairman & CEO Saum Sutaria responded that there was nothing unusual about the nature of exchange volumes in the quarter. He reiterated that this business tends to be more emergency department-driven, similar to Medicaid, which explains its larger impact on the hospital segment. EVP & CFO Sun Park concurred, stating the mix was consistent with prior periods.

Ask Fintool Equity Research AI

Answer

Saumya Sutaria, Chairman and CEO, explained that Tenet is an active member of the HealthTrust GPO for both its hospital and ambulatory businesses, with USPI being an anchor client on the ambulatory side. He stated there is no separation in their engagement with HealthTrust and that the exposure numbers cited by peers regarding supply spend base and location are applicable to Tenet as well, with no additional commentary to add.

Ask Fintool Equity Research AI

Answer

Dr. Saum Sutaria, Chairman and CEO, confirmed that the increase is a direct result of the company's strategic push into higher-acuity services. He noted that while the metric was up in Q4, it was balanced over the full year, and they expect it to remain balanced in 2025.

Ask Fintool Equity Research AI

Answer

CFO Mike Marks acknowledged awareness of the executive order but stated that HCA needs to see the specific draft rules that will emerge from the directive. He explained that until there is more specificity, the company cannot comment on the potential financial impact it could have on its operations.

Ask Fintool Equity Research AI

Answer

CEO Sam Hazen confirmed that the 50/50 split is still a fair assumption. He explained that the hurricane impact did not significantly affect capital spending plans, as the issues in North Carolina were community-related, not physical plant destruction, and the Largo situation involved repair costs, not major capital projects.

Ask Fintool Equity Research AI