The reaction to yesterday's lowered revenue and earnings projections from Tenet Healthcare Corp. has been swift and sharp. Tenet shares lost one-quarter of their value in Monday's trading, to $12.01 at Monday's close of trading from Friday's closing price of $16.23. Standard & Poor's, New York, said it was putting Tenet's corporate credit and senior unsecured debt ratings on "CreditWatch Negative," indicating a possible downgrade from the lowest investment-grade rating, BBB-.
Also, according to First Call/Thomson Financial Network and news reports, several stock analysts downgraded their ratings on Tenet's stock. And M. Lee Pearce, a Tenet shareholder and critic, reiterated his call to replace the management team with healthcare executives from outside the Santa Barbara, Calif.-based company.
In a separate news release, Pearce also questioned Tenet's plan to sell or close 14 of its hospitals, suggesting that the company will receive fire-sale prices for what are mostly profitable hospitals. -- by Vince Galloro