Cantor Fitzgerald maintains Tenet Healthcare stock rating despite potential ACA subsidy risks

Investing.com - Cantor Fitzgerald has reiterated an Overweight rating and $190.00 price target on Tenet Healthcare (NYSE:THC), currently trading near its 52-week high of $185.25, amid concerns about potential Affordable Care Act marketplace challenges. According to InvestingPro data, the company maintains a "GREAT" financial health score, with analysts’ targets ranging from $160 to $238.

The investment firm’s analysis focuses on the potential impact of premium increases on Health Insurance Exchange (HIX) enrollment, which currently represents approximately 5% of Tenet Healthcare’s $20.7 billion annual revenue.

Cantor Fitzgerald notes that if premiums increase substantially, states are preparing for significant drops in HIX enrollment, with the Kansas Health Institute forecasting that enrollment could revert to 2021 levels despite having doubled in 2025.

The firm estimates that if 40% of HIX revenues are cut in 2026 and half of those losing subsidies become uninsured and seek charity care, Tenet Healthcare could face EBITDA pressure of approximately 8%.

Despite these potential headwinds, Cantor Fitzgerald maintained its Overweight rating on Tenet Healthcare, suggesting confidence in the company’s ability to navigate these challenges.

In other recent news, Tenet Healthcare reported impressive financial results for the second quarter of 2025, with earnings per share (EPS) of $4.02, significantly surpassing the projected $2.88. The company also exceeded revenue expectations, reporting $5.27 billion compared to the forecasted $5.16 billion. Following these strong results, several financial firms have adjusted their price targets for Tenet Healthcare. BofA Securities raised its price target to $205 from $195, maintaining a Buy rating, while Raymond James increased its target to $200 from $185, also maintaining an Outperform rating. Cantor Fitzgerald raised its price target to $190 from $177, despite noting a lack of encouraging signals for future strength in their recent conference call. UBS set a new price target of $238, up from $230, highlighting a favorable impact from supplemental payments related to the Tennessee Directed Payment Program. These developments reflect a positive outlook from analysts despite some mixed signals from company communications.

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