Five Hospital Stocks to Buy Now

#3 Community Health Systems (NYSE:CYH)

-Hedge Funds with Long Positions (as of September 30): 59

-Aggregate Value of Hedge Funds’ Holdings (as of September 30): $1.17 billion

Community Health Systems (NYSE:CYH) has had a similar trend to Tenet Healthcare Corp this year and currently trades down by more than 53% year-to-date, which, however, has also made the stock of Community Health Systems (NYSE:CYH) highly lucrative. It currently trades at a forward price-to-earnings multiple of 6.58 and price-to-book multiple of 0.69, which is considerably cheaper than its peer group. The company is currently engaged in spinning off  ‘Quorum Health Corporation’ as a separate trading entity; this spin-off is expected to get completed in the first quarter of 2016. Samuel Isaly‘s Orbimed Advisors increased its stake in the company by 78% to over 2.7 million shares during the third quarter.

#2 Brookdale Senior Living, Inc. (NYSE:BKD)

-Hedge Funds with Long Positions (as of September 30): 66

-Aggregate Value of Hedge Funds’ Holdings (as of September 30): $2.17 billion

Brookdale Senior Living, Inc. (NYSE:BKD) is an outlier in this list because even though its shares slumped by over 33% during the third quarter, its popularity among hedge funds grew during that period as two more funds among the 730 funds covered by us reported a stake in the company as of the end of third quarter. Several activist investors have been pushing the company to spin-off its real estate holdings into a REIT and if the company fails to do so by the beginning of march, the proxy date, the investors can nominate directors to Brookdale Senior Living, Inc. (NYSE:BKD)’s board. Thomas Ellis and Todd Hammer‘s North Run Capital doubled its stake in the company to 5.1 million shares during the third quarter.

#1 HCA Holdings Inc (NYSE:HCA)

-Hedge Funds with Long Positions (as of September 30): 71

-Aggregate Value of Hedge Funds’ Holdings (as of September 30): $3.75 billion

Despite the number of hedge funds with ownership in HCA Holdings Inc (NYSE:HCA) declining by 12 and the aggregate value of investors’ holdings falling by $1.26 billion during the third quarter, HCA Holdings Inc (NYSE:HCA) still remained the most popular hospital stock among the funds we track at the end of September. The company is scheduled to report its fiscal 2015 fourth quarter results in January and analysts expect it to report EPS of $1.34 on revenue of $10.16 billion. On December 17, analysts at Goldman Sachs downgraded the stock to ‘Neutral’ from ‘Buy’, while keeping their price target constant at $80. Billionaire John Paulson‘s Paulson & Co continued to own over 4.7 million shares of the company at the end of the third quarter.

Disclosure: None