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April 07, 2016 01:00 AM

Tenet falls out of S&P 500

Bob Herman
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    tenet Health
    AP

    Tenet's Dallas headquarters

    Poor financials, a deteriorating stock price and investor unease over a difficult nine-month stretch have pushed hospital chain Tenet Healthcare Corp. out of the Standard & Poor's 500, a blue-chip stock index.

    Ulta Salon, Cosmetics & Fragrance, a beauty store chain, will replace Dallas-based Tenet in the S&P 500. Tenet will move to the S&P MidCap 400.

    “Tenet Healthcare has a market capitalization that is more representative of the mid-cap market space,” according to a news release from the S&P Dow Jones Indices.

    Tenet's market capitalization was about $2.8 billion as of Thursday. That's down more than 50% from just last July, when Tenet's market cap exceeded $6 billion and when the hospital company's stock was trading at more than $60 per share. Tenet closed trading Thursday at $28.52 per share.

    By comparison, HCA, the largest for-profit hospital operator in the country, has a market cap of $31.4 billion. HCA joined the ranks of the S&P 500 in January 2015.

    A large activist investor grew impatient with Tenet earlier this year. Glenview Capital Management, a New York City-based hedge fund run by billionaire Larry Robbins, forced Tenet to add two Glenview partners to its board of directors, although the sides say the stand-still agreement was friendly.

    Tenet lost $140 million last year, which was fueled by a large False Claims Act settlement and winnowing benefits from the Affordable Care Act's newly insured population. The company also appointed a new president of hospital operations last month.

    Tenet CEO Trevor Fetter's compensation dropped 14.5% last year as a result. He still made $15.4 million.

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        • Diversity in Healthcare
          • - Luminaries
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          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
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      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • Data Center
      • Data Center Home
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