Tenet Earnings: Improving Medical Utilization and Labor Trends Boost 2023 Outlook Mildly

Tenet turned in strong first-quarter results, and management raised its 2023 outlook mildly. Our 2023 assumptions were already on the strong end of management's new guidance ranges, and we do not anticipate materially changing our $95 fair value estimate, which remains well above recent share prices. Also, while our no-moat rating remains, we recognize that Tenet's operations have improved substantially in recent years, and we expect returns on invested capital to remain above capital costs throughout our five-year forecast period.