11 Best Mid-Cap Healthcare Stocks To Buy Now

In this article, we discuss 11 best mid-cap healthcare stocks to buy now.

The healthcare industry outlook is currently uncertain due to a combination of factors such as economic troubles, a shortage of healthcare workers, and the ongoing COVID-19 pandemic. It has become apparent that inflation is not temporary and that the economic situation has significantly worsened. 

McKinsey has updated and expanded its projections and now estimates that the healthcare profits will have a compound annual growth rate (CAGR) of 4%, increasing from $654 billion in 2021 to $790 billion in 2026. This is lower than their previous estimate of 6% growth between 2021 and 2025. The industry is expected to face challenging conditions in 2023, primarily due to high inflation rates and labor shortages, but McKinsey anticipates that improvement efforts will help the industry overcome these challenges in 2024 and beyond. Certain segments such as Medicare Advantage within payers, care settings like ambulatory surgery centers within providers, software and platforms (e.g., patient engagement and clinical decision support) within HST, and specialty pharmacy within pharmacy services can expect higher growth. However, the outlook for some segments, including general acute care and post-acute care within providers and Medicaid within payers, has deteriorated according to the firm. 

There are several new trends shaping the healthcare industry globally. Although the COVID pandemic promoted the latest methods to conduct remote healthcare checkups which enhance patient care and minimize costs for health providers, the sustainability of the conventional healthcare system has been brought into question. Virtual healthcare has the potential to personalize, quicken, and augment the ability to effectively deliver patient care. As per Deloitte, with more than one billion global population without access to medical care and nearly a billion people surviving without modern medicine, virtual healthcare offers a huge market opportunity to improve lives, while allowing businesses to profit. This will also make up for the shortage of healthcare workers and provide better outcomes for patients.

The US healthcare industry is enormous, with healthcare spending contributing to nearly 18.3% to the US GDP in 2021. According to Verified Market Research, the global healthcare market will be worth $665.37 billion by 2028. US national healthcare expenditure came in at $4.3 trillion in 2021, and it is forecasted to reach $6.2 trillion by 2028, as per the Centers for Medicare and Medicaid Services. 

The global healthcare sector will continue to expand as the population has exceeded 8 billion recently. Some of the best healthcare stocks to watch include Johnson & Johnson (NYSE:JNJ), Merck & Co., Inc. (NYSE:MRK), and UnitedHealth Group Incorporated (NYSE:UNH). However, in this article, we discuss the best mid-cap healthcare stocks to buy. 

Our Methodology 

We used stock screeners to select mid-cap healthcare stocks, which are companies with market caps ranging from $2 billion to $10 billion as of April 25. Then, we scanned Insider Monkey’s database of 943 hedge funds and picked the top 11 mid-cap companies that provide services in the healthcare sector with the highest number of hedge fund investors. These are the best mid-cap healthcare stocks to buy according to hedge funds.

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Best Mid-Cap Healthcare Stocks To Buy Now

11. Organon & Co. (NYSE:OGN)

Number of Hedge Fund Holders: 37

Organon & Co. (NYSE:OGN) develops and provides healthcare solutions that consist of prescription treatments and medical equipment specifically designed for women’s health.

On March 16, analyst Elliot Wilbur from Raymond James began coverage of Organon & Co. (NYSE:OGN) and gave it an Outperform rating with a price target of $33. Wilbur sees the recent decline in the company’s stock price, which dropped by over 20% after its Q4 2022 and 2023 outlook, as an opportunity to invest in a company that has a strong leadership position within the $40.0 billion women’s health category and is expected to have long-term growth potential. The analyst believes that Organon & Co. (NYSE:OGN) will climb up the value chain within the biosimilars industry, and its growth pillars will allow the company to generate low-to-mid single digit revenue growth over the next ten years, offsetting any modest erosion from Organon’s Established Brands portfolio.

According to Insider Monkey’s fourth quarter database, 37 hedge funds were bullish on Organon & Co. (NYSE:OGN), compared to 38 funds in the earlier quarter. Steven Boyd’s Armistice Capital is the largest stakeholder of the company, with 2.40 million shares worth $67 million. 

Like Johnson & Johnson (NYSE:JNJ), Merck & Co., Inc. (NYSE:MRK), and UnitedHealth Group Incorporated (NYSE:UNH), elite investors are piling into Organon & Co. (NYSE:OGN) for exposure to the healthcare sector. 

Miller Value Partners made the following comment about Organon & Co. (NYSE:OGN) in its Q3 2022 investor letter:

“Organon & Co. (NYSE:OGN) was the top detractor for the quarter, falling 30.0%2. Organon reported 2Q22 revenue of $1.59 billion, -0.6% Y/Y, ahead of consensus of $1.54 billion, and Adjusted EPS of $1.25, -27.3% Y/Y, in-line with analyst expectations. Adjusted EBITDA for the quarter came in at $512 million (32.3% margin), compared to 2Q21 Adjusted EBITDA of $627 million (39.3% margin). Management revised FY22 guidance for revenue of $6.1-6.3 billion, compared to previous guidance for revenue of $6.1-6.4 billion, to reflect persisting foreign exchange (FX) headwinds, and Adjusted EBITDA margin of 32-34%, compared to prior guidance for a margin of 34-36%, which incorporates ~$110 million of in-process research and development (IPR&D) and milestone expenses from business development. Management’s guidance implies FY22 Adjusted EBITDA of $2.05B, at the respective midpoints, or an Enterprise Value (EV)/EBITDA multiple of ~7.0x.”

10. DaVita Inc. (NYSE:DVA)

Number of Hedge Fund Holders: 34

DaVita Inc. (NYSE:DVA) delivers dialysis treatments to individuals in the United States who have chronic kidney failure. The company runs kidney dialysis facilities and offers associated laboratory services in outpatient dialysis centers. It is one of the best healthcare stocks to buy. The company reported Q4 non-GAAP earnings per share of $0.59 and a revenue of $2.92 billion, while the operating income came in at $256 million for the three months ended December 31, 2022. 

On February 23, Gary Taylor, an analyst at Cowen, increased the firm’s price target on DaVita Inc. (NYSE:DVA) from $76 to $90 and maintained an Outperform rating on the stock. Taylor stated that labor costs during the fourth quarter did not worsen significantly in comparison to the previous quarter, as the company had predicted in October. The analyst also pointed out that DaVita Inc. (NYSE:DVA) raised the lower end of its guidance.

According to Insider Monkey’s fourth quarter database, 34 hedge funds were long DaVita Inc. (NYSE:DVA), compared to 30 funds in the prior quarter. Warren Buffett’s Berkshire Hathaway is the largest stakeholder of the company, with 36 million shares worth $2.7 billion. 

Moon Capital made the following comment about DaVita Inc. (NYSE:DVA) in its Q4 2022 investor letter:

“During the fourth quarter, we purchased shares in DaVita Inc. (NYSE:DVA), a dialysis center operator. For those unfamiliar, kidney dialysis involves the critical removal of toxins, fluids and salts from the blood by artificial means. Roughly 500,000 patients receive kidney dialysis in the U.S., which requires a 3.5-hour treatment three times a week. The only alternatives to the treatments are a kidney transplant or potential fatality. Given the critical nature of its services, demand has little correlation with the overall economy, resulting in a highly recession resistant business.

The U.S. dialysis industry is highly concentrated, with two companies (DaVita and its competitor Fresenius) controlling a combined 80% of the $25 billion market. The dominance of this duopoly provides massive scale advantages, making it incredibly difficult for new entrants to gain profitable market share.

In the past, DaVita’s valuation has been penalized (we view unfairly) because the company generates a significant portion of its operating income from a small percentage of its patients. Of DaVita’s 200,000 patients, approximately 90% qualify for Medicare (or Medicaid), with the remaining 10% covered by a commercial insurance provider. While commercial insurers pay an average of $1,000 per treatment, the federal government’s pay rate for Medicare and Medicaid is only $275 – which is actually less than what it costs DVA to provide the treatment…”(Click here to read the full text)

9. Karuna Therapeutics, Inc. (NASDAQ:KRTX)

Number of Hedge Fund Holders: 34

Karuna Therapeutics, Inc. (NASDAQ:KRTX) is a clinical-stage biopharmaceutical company that focuses on developing and providing innovative drugs for individuals with neurological and psychiatric disorders. The company’s primary product, KarXT, is an oral muscarinic receptor modulator that is intended for the treatment of acute psychosis in schizophrenia patients. It is one of the best healthcare stocks to invest in. 

On March 22, Karuna Therapeutics, Inc. (NASDAQ:KRTX) announced the pricing of an underwritten public offering of 2,479,391 shares of its common stock at $161.33 per share. The expected gross proceeds from the offering are approximately $400 million. The underwriters have the option to purchase up to 371,908 additional shares of common stock within 30 days. The offering closed on March 24, 2023. 

H.C. Wainwright analyst Raghuram Selvaraju maintained a Buy rating on Karuna Therapeutics, Inc. (NASDAQ:KRTX) but decreased the firm’s price target on the shares from $320 to $300 on March 28. The analyst anticipates that Karuna Therapeutics, Inc. (NASDAQ:KRTX) will apply for approval of KarXT around mid-2023, with the potential for approval in the latter half of 2024. The analyst cited equity dilution as the reason for the drop in the target price.

According to Insider Monkey’s fourth quarter database, 34 hedge funds were bullish on Karuna Therapeutics, Inc. (NASDAQ:KRTX), compared to 43 funds in the earlier quarter. Andreas Halvorsen’s Viking Global is the biggest stakeholder of the company, with 1.18 million shares worth $232.60 million. 

Here is what Miller Value Partners Opportunity Trust Fund has to say about Karuna Therapeutics, Inc. (NASDAQ:KRTX) in its Q2 2022 investor letter:

“Karuna Therapeutics Inc. (NASDAQ:KRTX) had a lot of volatility over the quarter but ended up largely flat. We’ve done well with the position since initiation. The company is still clinical stage but has a largely de-risked asset, KarXT, focused on schizophrenia, a treatment area that has not had a new innovative treatment in decades. The company has shown strong Phase II data with Phase III results expected within weeks and an NDA (new drug application) submission expected in 2023. Furthermore, the company is developing KarXT in Alzheimer’s disease psychosis, providing the potential for further upside, a patient population where the mechanism of action has historically demonstrated both cognitive and behavioral improvements. We think the large opportunity in the schizophrenia space alone justifies a price more than double where it is currently trading.”

8. Roivant Sciences Ltd. (NASDAQ:ROIV)

Number of Hedge Fund Holders: 35

Roivant Sciences Ltd. (NASDAQ:ROIV) is a healthcare company that centers its efforts on utilizing technology to enhance drug development. The company achieves this goal by creating additional biotechnology and healthcare technology firms through its subsidiary companies. On March 28, Boston-based drug discovery company Covant Therapeutics, which operates under Roivant Sciences Ltd. (NASDAQ:ROIV), revealed that it has entered into a global licensing agreement with German pharmaceutical company Boehringer Ingelheim to co-develop cancer immunotherapies.

On January 5, Citi analyst Neena Bitritto-Garg raised the firm’s price target on Roivant Sciences Ltd. (NASDAQ:ROIV) to $14 from $11 and kept a Buy rating on the shares. The analyst explained that the TUSCANY-2 data for RVT-3101 confirms its potential position as a preferred biologic treatment for ulcerative colitis due to its high effectiveness and safety. The analyst believes that the value of RVT-3101 is still not fully reflected in the company’s shares.

According to Insider Monkey’s fourth quarter database, 35 hedge funds were bullish on Roivant Sciences Ltd. (NASDAQ:ROIV), compared to 28 funds in the prior quarter. Daniel Gold’s QVT Financial is the largest stakeholder of the company, with 122.5 million shares worth $979 million. 

7. Inspire Medical Systems, Inc. (NYSE:INSP)

Number of Hedge Fund Holders: 35

Inspire Medical Systems, Inc. (NYSE:INSP) is a company that specializes in medical technology and is dedicated to creating and marketing minimally invasive remedies for individuals with obstructive sleep apnea both domestically and globally. On February 7, Inspire Medical Systems, Inc. (NYSE:INSP) reported a Q4 GAAP EPS of $0.10 and a revenue of $137.9 million, outperforming Wall Street estimates by $0.68 and $0.15 million, respectively. The company expects that the total revenue for 2023 will fall within the bracket of $560 million to $570 million, in contrast to the consensus estimate of $545.71 million. This would indicate an increase in revenue of around 37% to 40% in comparison to the previous year.

On April 13, Anthony Petrone, an analyst at Mizuho, started coverage of Inspire Medical Systems, Inc. (NYSE:INSP) with a Buy rating along with a price target of $300. In a research note to investors, the analyst stated that the company is the only one with an approved hypoglossal nerve stimulation device for obstructive sleep apnea. He also mentioned that the positive results from a sleep survey indicate that Inspire Medical Systems, Inc. (NYSE:INSP) has the potential for same-store implant growth that may exceed expectations, and there is currently no competition from other hypoglossal nerve stimulation devices.

According to Insider Monkey’s fourth quarter database, 35 hedge funds were bullish on Inspire Medical Systems, Inc. (NYSE:INSP), compared to 37 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the biggest stakeholder of the company, with 632,330 shares worth $159.2 million. 

Wasatch Small Cap Growth Strategy made the following comment about Inspire Medical Systems, Inc. (NYSE:INSP) in its Q4 2022 investor letter:

“Inspire Medical Systems, Inc. (NYSE:INSP) develops minimally invasive solutions for patients with obstructive sleep apnea. The company has experienced strong demand for its products, which serve a previously unmet medical need. Inspire’s management team has executed well, growing revenues at a rapid clip since the company’s initial public offering in 2018. Most recently, Inspire reported year-over-year quarterly revenue growth of 77%, surpassing Wall Street estimates. Citing increased utilization at existing sites and the addition of new implanting centers, management raised its full-year revenue forecast and maintained margin guidance in the range of 83% to 85%.”

6. Apellis Pharmaceuticals, Inc. (NASDAQ:APLS)

Number of Hedge Fund Holders: 38

Apellis Pharmaceuticals, Inc. (NASDAQ:APLS) is a commercial-stage biopharmaceutical company and its main area of focus is the exploration, advancement, and marketing of therapeutic compounds that work by inhibiting the complement system. These compounds are designed to treat diseases that are related to inflammation and autoimmunity. Apellis Pharmaceuticals is currently in discussions with advisors to explore its options, following expressions of interest from large pharmaceutical companies. A Wells Fargo analyst has suggested that the company could be worth around $90 to $100 per share in a potential takeover, as per a research note dated April 3.

On March 9, Citi reiterated a Buy rating on Apellis Pharmaceuticals, Inc. (NASDAQ:APLS) but lowered the firm’s price target on the shares to $88 from $91. The analyst mentioned that the reason for the target decrease was due to dilution caused by the recent financing activities.

According to Insider Monkey’s fourth quarter database, 38 hedge funds were bullish on Apellis Pharmaceuticals, Inc. (NASDAQ:APLS), compared to 41 funds in the prior quarter. Kurt Von Emster’s VenBio Select Advisor is the largest stakeholder of the company, with 10.6 million shares worth $594.4 million. 

In addition to Johnson & Johnson (NYSE:JNJ), Merck & Co., Inc. (NYSE:MRK), and UnitedHealth Group Incorporated (NYSE:UNH), Apellis Pharmaceuticals, Inc. (NASDAQ:APLS) is one of the best healthcare stocks to invest in. 

5. Intellia Therapeutics, Inc. (NASDAQ:NTLA)

Number of Hedge Fund Holders: 39

Intellia Therapeutics, Inc. (NASDAQ:NTLA) is a genome editing company that focuses on the development of curative therapeutics for transthyretin amyloidosis, hereditary angioedema, deficiency-liver disease, deficiency-lung disease, lymphomas, hemophilia A and hemophilia B, acute myeloid leukemia, and various cancers and autoimmune diseases. It is one of the best healthcare stocks to invest in. 

On April 13, Whitney Ijem, an analyst at Canaccord, gave Intellia Therapeutics, Inc. (NASDAQ:NTLA) a Buy rating with a price target of $66. According to the analyst, the company’s focus on in-vivo gene editing in large, rare indications may not be the quickest route to the clinic compared to other CRISPR-based companies, but Intellia Therapeutics, Inc. (NASDAQ:NTLA)’s methodical approach has yielded positive results. The Phase 1 data from Intellia’s lead program, NTLA-2001, in ATTR, and wholly-owned NTLA-2002 in HAE, is said to look promising in terms of both safety and efficacy. The company’s progress through Phase 2 and into pivotal studies over the next 6-12 months is expected to provide additional opportunities for value creation, the analyst told investors. 

According to Insider Monkey’s fourth quarter database, 39 hedge funds were bullish on Intellia Therapeutics, Inc. (NASDAQ:NTLA), compared to 36 funds in the prior quarter. Cathie Wood’s ARK Investment Management is the largest stakeholder of the company, with 9.4 million shares worth $328.7 million. 

Carillon Tower Advisers discussed its stance on Intellia Therapeutics, Inc. (NASDAQ:NTLA) in its Q2 2021 investor letter.

“Intellia Therapeutics is a clinical-stage genome editing company focused on the development of proprietary, potentially curative therapeutics. The company’s stock soared after announcing positive interim data from an ongoing phase 1 clinical study of its in vivo gene editing candidate, which is being developed as a single-dose treatment for hereditary transthyretin (ATTR) amyloidosis. This specific form of therapy would be the first of its kind resulting in the precision editing of a gene in a target tissue in the human body.”

4. Bausch Health Companies Inc. (NYSE:BHC)

Number of Hedge Fund Holders: 41

Bausch Health Companies Inc. (NYSE:BHC) is involved in the development, production, and commercialization of a variety of pharmaceutical, medical device, and over-the-counter products, with a primary focus on the areas of eye health, gastroenterology, and dermatology. In the fourth quarter of 2022, Bausch Health Companies Inc. (NYSE:BHC)’s revenue of $2.2 billion outperformed Wall Street estimates by $60 million. It is one of the best healthcare stocks to invest in. 

In mid-November last year, Evercore ISI analyst Umer Raffat said the FDA has released new guidance for generic Xifaxan that is specifically tailored to the product. The “key change” in this guidance is that the waiver for in vivo testing for the 550 mg strength based on 200 mg testing is no longer granted. This means that generics will have to jump through an additional hurdle, according to Raffat, who noted that the 550 mg dose is the most important as it represents 99% of Xifaxan’s volume. The analyst assigned Bausch Health Companies Inc. (NYSE:BHC)’s stock an In Line rating.

According to Insider Monkey’s fourth quarter database, 41 hedge funds were bullish on Bausch Health Companies Inc. (NYSE:BHC), compared to 44 funds in the last quarter. John Paulson’s Paulson & Co is the biggest stakeholder of the company, with 26.4 million shares worth $166 million. 

Here is what Miller Value Partners Opportunity Trust Fund has to say about Bausch Health Companies Inc. (NYSE:BHC) in its Q2 2022 investor letter:

“Bausch Health Companies Inc. (NYSE:BHC) declined during the quarter as the company consummated its Bausch+Lomb IPO at valuations far below expectations, reported disappointing Q1 2022 results, and delayed its plan to spin out its Solta (aesthetics) business due to difficult market conditions. While the company spun off 10% of Bausch+Lomb (BCLO) they retained 90% of the company which they intend to distribute once they have met their target leverage ratio of 6.5-6.7x. The future spin-off value of the Bausch+Lomb piece represents a value of $12.55 per share, 39% above where Bausch Health is currently trading. The company recently appointed John Paulsen as Chair of the Board, which should accelerate value realization.”

3. Lantheus Holdings, Inc. (NASDAQ:LNTH)

Number of Hedge Fund Holders: 44

Lantheus Holdings, Inc. (NASDAQ:LNTH) operates globally and is involved in the development, production, and sale of diagnostic and therapeutic products that help doctors diagnose and treat a range of conditions including heart disease, cancer, and other illnesses. On April 24, Lantheus Holdings, Inc. (NASDAQ:LNTH) and POINT Biopharma Global Inc. (NASDAQ:PNT) disclosed that they have been given Fast Track designation by the US FDA for their candidate Lu-PNT2002, which is intended for the treatment of metastatic castration resistant prostate cancer. The Fast Track designation enables an accelerated review process, potentially leading to a quicker path to market for the asset.

On April 12, Truist raised the firm’s price target on Lantheus Holdings, Inc. (NASDAQ:LNTH) to $115 from $94 and kept a Buy rating on the shares. Truist’s model has been updated based on additional research and feedback from industry experts, which indicates that Lantheus Holdings, Inc. (NASDAQ:LNTH)’s previous assumptions regarding the anticipated decline in Pylarify’s average selling price were too conservative. As a result, the updated model predicts less pricing pressure on Pylarify and a more moderate decline in market share over the coming years compared to Truist’s previous projection.

According to Insider Monkey’s fourth quarter database, 44 hedge funds were bullish on Lantheus Holdings, Inc. (NASDAQ:LNTH), compared to 35 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the biggest stakeholder of the company, with 770,478 shares worth $39.2 million. 

Carillon Eagle Small Cap Growth Fund made the following comment about Lantheus Holdings, Inc. (NASDAQ:LNTH) in its Q4 2022 investor letter:

“Lantheus Holdings, Inc. (NASDAQ:LNTH) provides imaging diagnostics, targeted therapeutics, and artificial intelligence solutions used to fight serious medical conditions. Despite another strong quarterly update, the stock came under pressure due in part to investor concerns regarding a possible deceleration of revenue growth in the company’s leading product, Pylarify, as the company seems to have penetrated most of the early adopters of this imaging agent for prostate cancer. Later in the quarter, the company announced a strategic collaboration and exclusive licensing agreement for two late-stage therapeutic products used for the treatment of metastatic prostate cancer and neuroendocrine tumors. We believe approval of these products should help offset any significant declines in revenue growth of Pylarify.”

2. Prometheus Biosciences, Inc. (NASDAQ:RXDX)

Number of Hedge Fund Holders: 47

Prometheus Biosciences, Inc. (NASDAQ:RXDX) is a biotechnology company that is currently in the clinical stage of development. The company is focused on identifying, creating, and selling innovative treatments for a range of inflammatory bowel diseases, Crohn’s disease, ulcerative colitis, and systemic sclerosis-associated interstitial lung disease. 

On April 17, Credit Suisse analyst Tiago Fauth lowered Prometheus Biosciences, Inc. (NASDAQ:RXDX)’s rating from Outperform to Neutral and has set a price target of $200 following Merck’s announcement of its acquisition of the company for $10.8 billion in cash, or $200 per share.

According to Insider Monkey’s fourth quarter database, 47 hedge funds were bullish on Prometheus Biosciences, Inc. (NASDAQ:RXDX), up from 25 funds in the prior quarter. Steve Cohen’s 72 Investment Holdings is the biggest position holder in the company, with 1.8 million shares worth $203.2 million. 

Alger Small Cap Focus Fund made the following comment about Prometheus Biosciences, Inc. (NASDAQ:RXDX) in its Q4 2022 investor letter:

“Prometheus Biosciences, Inc. (NASDAQ:RXDX) is a biotechnology company focused on developing precision-based medicines to treat autoimmune conditions, primarily those afflicting the intestines such as inflammatory bowel disease (IBD) indications like ulcerative colitis and Crohn’s disease by leveraging a proprietary bioinformatics database. Shares outperformed during the period as the company reported positive Phase 2 clinical trial results from its (BD study, as the drug demonstrated significant patient improvement that was well above expectations. We believe Prometheus is an example of a company with “great discovery value”, as they could potentially be the leader and first-in-class precision-based drug to treat autoimmune diseases.”

1. Tenet Healthcare Corporation (NYSE:THC)

Number of Hedge Fund Holders: 59

Tenet Healthcare Corporation (NYSE:THC) is a healthcare services company that operates hospitals, surgical centers, and other healthcare facilities. The company offers a broad range of healthcare services, including diagnostic imaging, laboratory services, and rehabilitation services. It is one of the best healthcare stocks to invest in. 

On April 20, Cantor Fitzgerald analyst Sarah James gave Tenet Healthcare Corporation (NYSE:THC) an Overweight rating and set a price target of $73. The analyst believes that Tenet Healthcare Corporation (NYSE:THC) is well-positioned to experience significant margin expansion over the long term due to its recent acquisitions and the establishment of new facilities. The company is also reportedly gaining a larger share of the ambulatory surgery center market, which is currently growing at a fast pace. Additionally, the company is improving its margin through commercial pricing strategies, the analyst told investors in a research note. 

According to Insider Monkey’s fourth quarter database, 59 hedge funds were bullish on Tenet Healthcare Corporation (NYSE:THC), compared to 60 funds in the prior quarter. Larry Robbins’ Glenview Capital is the biggest stakeholder of the company, with 8.9 million shares worth $434 million. 

Greenlight Capital made the following comment about Tenet Healthcare Corporation (NYSE:THC) in its Q4 2022 investor letter:

“Though we believe we are in the middle stages of a bear market, we did establish a new medium-sized long position in Tenet Healthcare Corporation (NYSE:THC) during the fourth quarter.

THC is an operator of hospitals and ambulatory surgery centers (ASC). In recent years, the company has grown and transitioned its business mix towards its higher-margin ASCs. This shift has enabled the company to generate significant, and what we believe to be sustainable, cash flows.

During 2022, the company lowered its guidance due to COVID and inflationary headwinds, resulting in its shares declining by more than 50% year-to-date through late October. We believe this pullback offered an attractive opportunity to participate in the company’s transformation, as we expect its ASC growth to remain strong and its now smaller hospital portfolio to improve from both a cost and volume perspective. We acquired our shares from late December through the beginning of January for an average price of $48.61, or 8.7x 2023 consensus earnings. THC recently announced and began its plan to repurchase about 20% of the outstanding shares by the end of 2024.”

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Disclosure: None. 11 Best Mid-Cap Healthcare Stocks To Buy Now is originally published on Insider Monkey.