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What's in the Cards for HCA Holdings (HCA) in Q1 Earnings?

HCA Holdings Inc. HCA is expected to report first-quarter 2016 results on May 3. Last quarter, the company reported earnings of $1.69 per share, which beat the Zacks Consensus Estimate by 30 cents.

Notably, the company’s results compared favorably with the Zacks Consensus Estimate in the last four quarters, with an average beat of 5.53%.



Let's see how things are shaping up for this quarter.

Factors at Play

HCA Holdings is expected to benefit from the growing admission rate and improving payor mix based on the continuing implementation of the Affordable Care Act (Obamacare). The company is also poised to benefit from robust same-store growth and stringent cost management.  

Earnings Whispers

Our proven model does not conclusively show that HCA Holdings is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

Zacks ESP: The Earnings ESP for HCA Holdings is -1.34%. This is because the Most Accurate estimate stands at $1.47, while the Zacks Consensus Estimate is pegged at $1.49.

Zacks Rank: HCA Holdings carries a Zacks Rank #2, which when combined with -1.34% ESP makes surprise prediction difficult.

Meanwhile, we caution against stocks with a Zacks Ranks #4 and #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are a few stocks worth considering that, per our model, have the right combination of elements to post an earnings beat this quarter:

Quality Systems QSII, with an Earnings ESP of +6.25% and a Zacks Rank #2.

Becton, Dickinson and Company BDX, with an Earnings ESP of +1.99% and a Zacks Rank #2.

The Cooper Companies COO, with an Earnings ESP of +.52% and a Zacks Rank #2.
 

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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
QUALITY SYS (QSII): Free Stock Analysis Report
 
HCA HOLDINGS (HCA): Free Stock Analysis Report
 
BECTON DICKINSO (BDX): Free Stock Analysis Report
 
COOPER COS (COO): Free Stock Analysis Report
 
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