Texas-based health care services company Tenet Healthcare Corp. THC seems to have fallen out of favor with investors. The shares of Tenet Healthcare have lost nearly 40% in last one year, whereas the Zacks Hospitals industry has registered an increase of 2.5%. This underperformance has stemmed from a number of headwinds faced by the company over the last few years.Bad DebtsThe company caters to a large number of uninsured and underinsured patients with a high burden of co-payments and deductibles. As a result, it has been accumulating a high level of uncollectible accounts and rising bad debts since 2013. In the year 2016, bad debt as a percentage of revenues was 5.8% compared with 6.2% in 2015. The company expects bad debt ratio of 6.25–7.25% for 2017.High LeverageTenet Healthcare has been witnessing an increase in long-term debt since 2014. In the year 2016, the company had nearly $15.1 billion of long-term debt, up 5% year over year. At the end of 2016, the company witnessed a long-term debt-to-equity ratio of 34.5x. Tenet Healthcare’s regular refinancing through tender offers and exchange offers as well as open market repurchases continues to raise the level of liability. The company also has to deploy a substantial part of its cash flow to pay the interests on its debts and thus, is left with limited funds to utilize for operations, growth initiatives or capital expenditures. For 2017, the company forecasts interest expenses of roughly $1.03 billion.Increasing ExpensesAnother area of concern is the increase in the company’s operating expenses over the past few years. The metric has grown at a five-year CAGR (2010–2015) of 19.7%, mainly due to higher salaries, wages and benefits, supplies and other operating expenses. Also, in 2016, operating expenses grew by 5.2% owing to an increase in information technology service contract, expenses related to the HIT implementation program, malpractice expenses, physician relocation costs, hospital provider fees, annual salary hikes and employee benefits. Continuous increase in these charges and expenses is expected to drain the margins.Overvalued StockThe stock also seems to be overvalued than its peers. Its Price to Earnings Growth (PEG) ratio is pegged at 2.43 compared with the industry level of 1.63.Downward Estimate RevisionsThe Zacks Consensus Estimate for 2017 and 2018 has been revised downward over the last 60 days. Estimated have gone down by 37% to $1.18 for 2017, and by 35% to $1.69 for 2018.First-Quarter Earnings Beat UnlikelyThe company presently carries a Zacks Rank #5 (Strong Sell). The stock also has an Earnings ESP of -3.85%. As it is, we caution against Sell-rated stocks (Zacks Rank #4 or 5) going into an earnings announcement, especially when the company is seeing negative estimate revisions.We note that the company has been missing estimates since the second quarter of 2016. In fact, it had an average negative surprise of 17.97% in the last four quarters.Stocks that Warrant a LookSome better-ranked stocks from the same space areUnitedHealth Group, Inc. UNH, Inogen Inc. INGN and Infinity Pharmaceuticals, Inc. INFI. While Inogen and Infinity sport a Zacks Rank #1 (Strong Buy), UnitedHealth holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Inogen posted positive surprises in three of the last four quarters with an average positive surprise of 49.08%.Infinity delivered positive surprises in the trailing four quarters with an average beat of 28.38%.UnitedHealth delivered positive surprises in last four quarters with an average beat of 3.80%.Zacks' Hidden TradesWhile we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors. Click here for Zacks' secret trade>>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 Inogen, Inc (INGN): Free Stock Analysis Report Infinity Pharmaceuticals, Inc. (INFI): Free Stock Analysis Report UnitedHealth Group Incorporated (UNH): Free Stock Analysis Report Tenet Healthcare Corporation (THC): Free Stock Analysis Report To read this article on Zacks.com click here.